Now tax on your EPF and PF will fund MENREGA, Forget about its utility for security in your old age.

With no security from govt in our old age inspite of paying taxes through our nose through out our life ,All of us were just bankning on our EPF and PF accumulations to take care of us ,when we become old.But Modi has looted all that also, so now your EPF and PF will be looted by taxing by Modi govt to buy votes in Name of free doles named MENERGA.Our present is already bleek ,but now it seems future has also been painted Black with single strock.Thumbs down and oppose this antisocial act by Govt.

 

@kharb i think PF fund is linked with pension received. if PF fund is withdrawn pension gets reduced proportinately. so govt is trying to reduce that tendency to withdraw PF fund.
alreaady govt is bearing huge laibilty of pension of central govt emplyess. so this action will reduce the risk of that laibilty and assur that govt has sufficient funds with them for devpt.

 

No it is not,Govt will tax it irrespective of when you witdrew it.Even if it is withdrwan like pension,all withdrawals will become taxable .Now lazy kamchor will enjoy your EPF and PF along with corrupt politicians.Instead of showing efficiency in spending ,govt is on looting spree,now on all employees of private sector.

 

Usually I am of the opinion that all govt are same, but the rate of tax burdens imposed by BJP is worrying. PF taxation is cruel.

It is all the more cunning and ureasonable coming from a political party that came to power under the promise to reduce tax burden. I am guilty of not being a regular at voting but I have made it my personal life mission to do my 1 vote bit to kick this lying set of leaders out.

 

@kharb. I agree with you. The EPF is really the only social security net available to salaried class, especially the private sector who really work for the money (unlike the govt. sector). If at all the government wanted to reduce its liability it should have encouraged EPFO to invest more in markets, work on flexible market linked returns. On one hand the government subsidizes interest on EPF by giving higher than market returns and the other hand it is taxing the interest. This completely makes no sense.

 

ok. why this govt. is not imposing super rich tax- like a special tax on people having assets more than 100 cr or income more than 10 cr in a year.
instead they increase tax burden on middle class people who work their whole life for earning salary for living???

 

Well, you should ask this to Mr. Jaitley? However I think @30% income tax rates for those in the highest income bracket are pretty high. Also luxury items which are presumably used by the super rich are very highly taxed. The government has to increase the tax base (bring large farmers, traders, medium and large retailers) under the tax net. However I do not think this is going to happen during mine or yours lifetime. Or maybe it will ?

 

OK. Some clarity has emerged. There is no tax on PPF. Only the EPF is taxed and the tax is on 60% of the interest accrued.

 

this decision is so bad and i think the govt. may have to cancel this in the coming months.
in this povison a threshold limit on salary of 15000 pm is also there. atleast this limit shud be raised to 50000 pm

 

This is starting. With the time they will continue to increase it to cover entire pf for all.
They can not develop country, they dont have any plan except requesting foreign tycoons to invest in India. To meet expenses they are taking approach to squeeze employees. See how they reduced corporate tax to tycoons. Message is clear whome they are giving and whome squeezing.

 

Indian Public: Withdraw budget 2016 proposal to tax PPF/EPF - Sign the Petition!
https://www.change.org/p/indian-pub...utm_source=share_petition&utm_medium=whatsapp

 

Clarification about Changes made in the Tax Treatment for Recognised Provident Fund & National Pension System (NPS)

There seems to be some amount of lack of understanding about the changes made in the General Budget 2016-17 in the tax treatment for recognised Provident Fund & NPS.

The following clarifications are given in this matter:-

(i) The purpose of this reform of making the change in tax regime is to encourage more number of private sector employees to go for pension security after retirement instead of withdrawing the entire money from the Provident Fund Account.

(ii) Towards this objective, the Government has announced that Forty Percent(40%) of the total corpus withdrawn at the time of retirement will be tax exempt both under recognised Provident Fund and NPS.

(iii) It is expected that the employees of private companies will place the remaining 60% of the Corpus in Annuity, out of which they can get regular pension. When this 60% of the remaining Corpus is invested in Annuity, no tax is chargeable. So what it means is that the entire corpus will be tax free, if invested in annuity.

(iv) The Government in this Budget has also made another change which says that when the person investing in Annuity dies and when the original Corpus goes in the hands of his heirs, then again there will be no tax.

https://pib.nic.in/newsite/erelease.aspx?relid=137108

 

Controversial EPF Tax: Government's 11-Point Clarification

The Finance Ministry on Tuesday issued an 11-point clarification on the changes made in the Budget 2016-17 on tax treatment for provident fund and NPS (National Pension Scheme). "There seems to be some amount of lack of understanding about the changes made in the General Budget 2016-17 in the tax treatment for recognised Provident Fund & NPS," the Finance Ministry said in a statement.

Here are the clarifications issued by the Finance Ministry:

(i)The purpose of this reform of making the change in tax regime is to encourage more number of private sector employees to go for pension security after retirement instead of withdrawing the entire money from the Provident Fund Account.

(ii)Towards this objective, the Government has announced that 40 per cent of the total corpus withdrawn at the time of retirement will be tax exempt both under recognised Provident Fund and NPS.

(iii)It is expected that the employees of private companies will place the remaining 60 per cent of the Corpus in Annuity, out of which they can get regular pension. When this 60 per cent of the remaining corpus is invested in annuity, no tax is chargeable. So what it means is that the entire corpus will be tax free, if invested in annuity.

(iv)The government in this Budget has also made another change which says that when the person investing in annuity dies and when the original corpus goes in the hands of his heirs, then again there will be no tax.

(v)The idea behind this mechanism is to encourage people to invest in pension products rather than withdraw and use the entire Corpus after retirement.

(vi)The main category of people for whom EPF scheme was created are the members of EPFO who are within the statutory wage limit ofRs.15,000 per month. Out of around 3.7 crores contributing members of EPFO as on today, around 3 crore subscribers are in this category. For this category of people, there is not going to be any change in the new dispensation.

(vii)However, in EPFO, there are about 60 lakh contributing members who have accepted EPF voluntarily and they are highly-paid employees of private sector companies. For this category of people, amount at present can be withdrawn without any tax liability. We are changing this. What we are saying is that such employee can withdraw without tax liability provided he contributes 60 per cent in annuity product so that pension security can be created for him according to his earning level. However, if he chooses not to put any amount in Annuity product the tax would not be charged on 40 per cent.

(viii)There is no change in the existing tax treatment of Public Provident Fund (PPF).

(ix)Currently there is no monetary ceilings on the employer contribution under EPF with only ceiling being that it would be 12 per cent of the salary of the employee member. Similarly, there is no monetary ceiling on the employer contribution under NPS, except that it would be 10 per cent of salary.

(x)Now the Finance Bill 2016 provides that there would be monetary ceiling ofRs.1.5 lakh on employer contribution considered with the ceiling of the 12 per cent rate of employer contribution, whichever is less.

(xi)We have received representations today from various sections suggesting that if the amount of 60 per cent of corpus is not invested in the annuity products, the tax should be levied only on accumulated returns on the corpus and not on the contributed amount. We have also received representations asking for not having any monetary limit on the employer contribution under EPF, because such a limit is not there in NPS. The Finance Minister would be considering all these suggestions and taking a view on it in due course

https://profit.ndtv.com/news/budget...ax-governments-11-point-clarification-1282839

 

The number of taxpayers in our country, is about 35 million people which is 2.9 per cent of the over 121 crore population, wherein only 42,800 show annual income over Rs one crore ... Has any government considered the left over 97.1%? In this 97.1% around 21.9% are below poverty line. What is the income tax earning made or being made from the balance 75.2%? None of them have the guts to touch this lot ... Never ever will they do that, because they will loose their vote banks ... Only God should save us "the poor tax payers" ...

 

Withdraw budget 2016 proposal to tax Employee Provident Fund (EPF)

https://www.change.org/p/withdraw-b...utm_source=share_petition&utm_medium=copylink

 

be proud to be tax payer.
what is the amount of income tax collected from this 2.9%?