EPF tax rollback: Here are all the reactionshttps://indianexpress.com/article/business/budget/epf-tax-withdrawn-arun-jaitley/

EPF tax rollback: Here are all the reactions

The government's decision to exempt only 40 per cent of the corpus from tax has angered the salaried class and was slammed by Opposition party leaders.

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Indian Finance Minister Arun Jaitley entering Parliament to present Union Budget 2016. (Source: AP Photo)

Facing heat over its decision to tax 60 per cent of Employees’ Provident Fund on withdrawal, the government on Tuesday announced a rollback on its new proposal which was first announced by Finance Minister Arun Jaitley in the Union Budget last month.

The government’s decision to exempt only 40 per cent of the corpus from tax has angered the salaried class and was slammed by Opposition party leaders. Few days after its announcement, strong reactions from public have prompted the government to issue a clarification over its decision to change the existing structure.

READ: After a taxing week, Jaitley rolls back EPX tax

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“The purpose of this reform of making the change in tax regime is to encourage more number of private sector employees to go for pension security after retirement instead of withdrawing the entire money from the Provident Fund Account,” said Jaitley.

The government in its press note said that they want private sector employees to opt for pension security after retirement instead of withdrawing the entire amount from their EPF account. The government hoped that pensioners would invest the 60 per cent in annuity schemes run by insurance companies, which provide low returns. Trade Unions were also among the most vocal protesters against taxing EPF withdrawals.

Here are the reactions

After EPF was withdrawn

Before EPF was withdrawn