Govt to Rollback on EPF after PM’s Call For Review

Finance Minister Arun Jaitley is ready to make a suo motu statement regarding the controversy surrounding his EPF proposals in Lok Sabha on Tuesday without even waiting for start of the discussion on Budget 2016-17 in Parliament. The updated list of Lok Sabha’s business for Tuesday, in fact, has already listed Jaitley to make his statement regarding “the issue of tax proposals for EPF/Superannuation Fund” after the Question Hour gets over at noon.

Following criticism over the proposal, PM Modi had reportedly suggested to the FM Jaitley that the tax be deferred for now and that a detailed examination of the proposal be done.

In recent budget, Jaitley had proposed that after April 1, 2016, 60 per cent of the amount deposited in the EPF account of the employee will be taxable at the time of withdrawal, and 40 % will be tax free. Earlier, the entire amount was tax free at the time of withdrawal if the employee has completed five years of continuous service.

Following criticism from the opposition, trade unions and even RSS affiliates, the Finance Minister had at a meeting of NDA lawmakers last Tuesday explained the proposal in detail and had added that any decision on a reversal would be taken by the Prime Minister.