The finance minister had to roll back EPF tax proposal due to pressure/opposition. Had there been no opposition to this proposal, he would have been embolden to tax PPF, gratuity, leave encashment, and introduce wealth tax also in the next Budget. Now, the time has come to exempt NPS withdrawals from tax also, to bring them on a par with PPF and EPF. In fact, NPS management is with private players and they charge an annual fee. NPS funds are invested in shares and bonds and returns are subject to market risks, not assured. Have we forgotten the US-64 controversy in which millions of investors lost their money and the government had to pour in money to repay investors, though not in full? Then there is this recent National Spot Exchange fraud where few thousand of crores of rupees were lost. We do not want to enrich FIIs by giving them an opportunity to play in our share market. The government should withdraw all NPS and EPF funds from the share market and use funds for infrastructure projects and assure 8.5% to 9% return to investors. The share index does not reflect the true health of our economy.
Sudhir Keshav Bhave
Making in India
Apropos of the news report “Made-in-India Suzuki Baleno launched in Japan” (FE, March 10), within months of the launch of Maruti Suzuki Baleno in India, parent company Suzuki has launched a Made-in-India version of the model in Japan. In addition, the Baleno will be exported more than 100 countries. This speaks volumes about how Maruti, established 30 years ago, has come of age as far as automotive manufacturing and supply chain is concerned. The news is also a booster shot for the NDA government’s Make-in-India campaign—that it is not about “assembling in India”, but more about “creating in India”. The Baleno—which was first globally exhibited at the Frankfurt Motor Show in September 2015 and launched in India on October 26, 2015—is manufactured only in India at Maruti Suzuki’s Manesar facility in Haryana. The launch of the Baleno in Japan, which has very stringent quality standards, reaffirms the growing importance of Maruti in Suzuki Motor Corporation’s global business strategies.
Who takes the credit?
The Centre withdrawing the proposal to tax EPF withdrawals comes as a huge relief for the working class. And the credit for the rollback goes to the latter, not to the former. After being vouched by the government and the officials in the ministry concerned, the ruling party making a U-turn on the issue speaks volumes about the consultation process and spadework involved in drafting the Union Budget. The objective of the government cutting losses through taxing 60% of PF withdrawals hitting a roadblock shows that such unilateral decisions often meet with resistance in a democratic polity.
R Prabhu Raj
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