The State Bank of India (SBI) financial analysis staff led by Dr. Soumya Kanti Ghosh has suggested Government of India (GoI) to deliver parity in Employees’ Provident Fund (EPF) and Public Provident Fund (PPF) rate of interest. The SBI analysis staff made this suggestion whereas showcasing its findings on whether or not Indians have turn into extra danger averse post-market aberrations in 2008? The SBI analysis staff went on so as to add that one of many key parts of monetary financial savings of households in India is small financial savings and its rates of interest are administratively decided.
Advising GoI to deliver parity in EPF and PPF rate of interest the SBI analysis staff identified, “PPF is a Government-backed, zero-default risk, long-term small savings scheme akin to quasi floating rate deposits with the objective to provide retirement security to self-employed individuals and workers in the unorganised sectors. We expect the Government to maintain a parity in interest rates between organised sector / EPF (Employees’ Provident Fund) and unorganised / PPF for the larger goal of social security.”
The SBI analysis additionally prompt GoI to take away the 15 12 months lock-in interval for PPF and provides the traders the choice to withdraw their cash inside a stipulated time with some type of disincentive.
Income Tax exemption for SCSS traders
Batting in favour of its suggestion to deliver parity in EPF and PPF rate of interest, the SBI analysis staff went on so as to add that the GoI must also consider exempting the earnings from any tax outgo for Senior Citizen Saving Scheme (SCSS) traders. The SBI analysis staff stated that the February 2020 excellent underneath SCSS was ₹73,725 crore. If the quantity is given full tax rebate or rest as much as a threshold degree it is going to have nominal impression on the federal government exchequer.
Subscribe to Mint Newsletters * Enter a sound e-mail * Thank you for subscribing to our e-newsletter.
