Online campaign against EPF tax gets 140,000 signs
EPF corpus till March 31, 2016 EPF corpus after April 1, 2016
Current age (year) Basic pay
(`) Monthly PF contribution
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An online petition against the proposed tax on Employee Provident Fund (EPF) withdrawals, started by chartered financial analyst Vaibhav Aggarwal and Gurgaon-based Cians Analytics Financial, has got over 140,000 sign-ups on its first day.
Vaibhav’s Change.org petition with #EPFNoTax has been shared widely on Twitter and Facebook, and the number of signatories are growing by a few Total corpus
(` lakh)
Interest component
(` lakh) thousands every hour.
“I am disillusioned by the government’s decision to tax EPF. It is a draconian move,” Aggarwal told HT. “It hurts me and many youngsters in this country. Our appeal to the government is, withdraw this tax immediately.”
In his budget speech on Monday, finance minister Arun Jaitley had announced the decision to tax withdrawals exceeding 40% of an individual’s retirement pot in the EPF, unless the sum is reinvested in a pension product such as an annuity. In the face of rising opposition from the Total corpus
(` Lakh)
Interest component
(` lakh) middle-class and markets alike, the government has indicated it is open to amendments to the proposal.
However, even this is unacceptable to 60-million EPF subscribers in India, Aggarwal said.
A similar campaign supporting net neutrality was launched on change.org by Kollam (Kerala)based Sandeep Pillai in December last year. It was supported by 375,000 people online, and was one of the campaigns that forced the government and the Telecom Regulatory Authority of India to re-examine the issue.
SCENARIO 1 Taxed portion of the corpus
(` lakh)
If 60% of total corpus is taxed @ 30% Loss in tax
(` lakh) Effective tax rate on your
corpus
SCENARIO II Taxed portion of the corpus
(` lakh)
If 60% of interest accumlated is taxed @ 30% Loss in tax
(` lakh) Effective tax rate
on your corpus