Finance Minister, Arun Jaitley, finaly succumbed to pressure and on 8th Match, 2016 announced that the government was withdrawing the proposed 60 per cent Employees’ Provident Fund tax. He said: “We propose to withdraw the tax… the tax proposal for NPS scheme has been retained. The intention was to encourage a pensioned society”.
On 29th February, in his budget proposal, Jaitley had proposed that withdrawals from EPF fund would be taxed at 60 per cent and that it would get the same treatment as any other pension annuity schemes. This decision drew flak from not only the opposition parties, but several Unions also threatened to stage a protest, thereby, pressurising the government to rollback this tax implementation.
"This is a draconian act and will be a killer blow to already tax burdened salaried class which pays 30% income tax + 30% taxes in indirect form i.e customs, excise, service tax etc," says Vaibhav Agarwal, who started an online petition, urging the government to reconsider their decision.
Following the announcement in the Lok Sabha, this move drew serious flak from the salaried middle-class and today's announcement is bound to come as a huge relief to them. Some of the reactions-
Good EPF tax rolled back. But 1 big budget announcement, 4 different clarifications. Maximum government, Minimum governance! #ModiSarkar— Sitaram Yechury (@SitaramYechury) March 8, 2016
Arsene Modi: "I did not see EPF Tax. I have to look at it again. Maybe we lacked a little bit rollback."
— INS Vadukut (@sidin) March 8, 2016
— Dr Ajoy Kumar (@drajoykumar) March 8, 2016
Nice of govt. to move the words around on EPF tax -
Instead of taxing the withdrawal,— Ramesh Srivats (@rameshsrivats) March 8, 2016
they decided to withdraw the tax.
— Sanjay Jha (@JhaSanjay) March 8, 2016
Finally the Govt was forced to listen to people and roll back the patently unfair tax on EPF (1/2)
— Office of RG (@OfficeOfRG) March 8, 2016
Modi govt withdraws EPF Tax. Glad to know voice of tiny number of honest taxpayers still matters in this country
— Abhijit Majumder (@abhijitmajumder) March 8, 2016
Jaitley withdraws EPF tax proposal - so now EPF is completely exempt on Exit, no matter what. NPS proposals probably stay.
— Deepak Shenoy (@deepakshenoy) March 8, 2016
Final result in my poll on #EPF tax showed 90% of nearly 2,500 votes cast wanted total rollback. (See result on pinned tweet)
— Minhaz Merchant (@minhazmerchant) March 8, 2016
EPF tax rolled back: guess govts do respond to what trends on Twitter sometimes!!?
— Rajdeep Sardesai (@sardesairajdeep) March 8, 2016
Net Neutrality & EPF Tax debate has shown tht people's voice can be heard. Proud of the fact that we hv a govt which listens to the ppl...
— Pradeep Mamgain (@pc_navy) March 8, 2016
:) ROFL moment. RG claims credit. Says "My pressure worked. Govt rolled back EPF tax." pic.twitter.com/tawEX437mG @hindurajyam @venky6666
— Indopolity (@Indopolity) March 8, 2016
EPF tax withdrawal is a victory for Rahul Gandhi & the middle class. #RGforcesEPFtaxWapsi
— SKA (@ska4RahulGandhi) March 8, 2016
So who flew down to rescue Gotham from #EPF tax? Gandalf? Superman? Batman? Spiderman? Bheem? Arjun? Hanuman? Or too much bad PR?
— ranjona banerji (@ranjona) March 8, 2016
Now - the formula is simple. Anything goes wrong blame Modi. Anything right credit RaGa and/or Kejriwal. EPF Tax. https://t.co/yUxqz00Pd7
— TheGhoseSpot (@SandipGhose) March 8, 2016
EPF Tax fiasco is yet another example of this Govt's ham-handed economic policies.
Slogans & U-Turns is what this Modi govt is known for.
— Srivatsa (@srivatsayb) March 8, 2016
Why Govt wants money,everywhere??
1. From Petrol+Excise
2. For #SwachhBharat
3. EPF Tax from retired
4. 6.35 Cr from Punjab for #Pathakot.
— Swachh Politics (@SwachhPolitics) March 7, 2016
Full roll back is needed. Don't confuse even more.
- No tax on EPF
- Allow withdrawal https://t.co/80uZL1c70n
— Srivatsa (@srivatsayb) March 8, 2016