Breaking from the long-held practice of exemption at all stages, the Budget for 2016-17 sought to impose a retirement tax at the time of final withdrawal on 60 per cent of contributions made after April 1, 2016, to EPF and other schemes.
Seeking to dispel fears, the government on Tuesday said PPF will not be taxed on withdrawal and only the interest that accrues on contributions to employee provident fund made after April 1 will be taxed while principal will continue to be tax exempt.
In spite of this clarification, the twitteratti weren’t convinced as most of them lambasted Jaitley for ‘stabbing them in the back’.
(With Inputs From PTI)
(Feature Image Source: AFP)