EPF tax proposal a move to secure citizens' after-retirement life: Hasmukh Adhia

Stating that the tax proposal on EPF in Budget 2016-17 was misconstrued, revenue secretary Hasmukh Adhia said here that the government intends to secure citizens' retirement life by diverting savings to annuity schemes. Adhia was in Ahmedabad to attend a budget discussion organised by Ahmedabad Management Association (AMA).

He said that there was miscommunication about the proposal in budget which needed to be cleared.

There are over 30 million accounts in provident fund and union government has proposed 40 per cent tax on 60 per cent of total amount at the time of withdrawal.

"It was too divert people to pension schemes after retirement that government proposed this tax in budget. Because of miscommunication, the proposal has been facing conflicts. Finance minister will soon talk about it in Parliament," said Adhia.

Government wants people to invest in annuity schemes so that their after retirement life would be secure financially, he said.

"There are has been misunderstanding about the proposal which needs to be cleared and government is working on it to answer," said Adhia.

For the first time in India, the central government increased planned expenditure by 15 per cent, which was the highest ever.

Adhia said, "At the time of budget preparation, Prime Minister and Finance Minister had asked to raise planned expenditure in the budget."

Talking about Goods and Service Tax (GST) Adhia said that the government will soon put detail draft of GST in public domain to get views of common people.

"By April this year, we will put draft of GST in public domain and will invite suggestion on it. Government is hopeful to implement GST by April 2017."