The decision to withdraw the budgetary proposal to impose tax on withdrawals from Employees Provident Fund, has brought cheers to salaried class people.
The Union Finance Minister, Arun Jaitley, on Tuesday, announced the decision to withdraw the taxation proposal following a backlash both inside and outside Parliament.
S. Dhananjayan, a chartered accountant, pointed out that imposing tax on the withdrawals of EPF was too harsh on the salaried class considering the economic situation of the workers in the country.
The workers in Tirupur knitwear cluster felt overjoyed when heard about the tax withdrawal decision as they feel that the Government should not have interfered into their rights to utilise the benefits. “The government, while proposing the taxation, has been of the view that the tax was aimed at encouraging the people to invest 60 per cent of the withdrawals into pension products rather than use the entire corpus immediately after retirement”, the workers said.