ZEE Business
ZEE BUSINESS
हिंदी में पढ़ें  हिंदी में पढ़ें
Live TV
Live TV
  • Home
  • Budget 2023
  • Adani Saga
  • Markets
    • Stocks
    • Global Markets
    • IPO
    • Companies
    • Currency
    • Commodities
  • My Money
  • Calculators
    • Income Tax Calculator
    • Home Loan/EMI Calculator
    • Mutual Fund Returns Calculator
    • Personal Loan Calculator
    • Car Loan Calculator
    • SIP calculator
    • Lumpsum Calculator
    • SWP Calculator
  • Videos
    • M Se Market
    • Jeb Zindagi Zaroorat
    • Light Camera Stocks
    • Tech Takes
    • Big Bulls Ka Nishana
    • Paisa Wasool
    • Commodity Ke MrityunjayMantra
    • The Right Property Show
  • Economy & Infra
    • Policy & Initiatives
    • Agriculture
    • Telecom
    • Aviation
    • Railways
    • Retail
    • Roadways
    • World Economy
  • Exclusive
    • Wealth Guide
    • Interviews
  • Auto
    • Cars
    • Bikes
    • Electric Vehicle
    • Commercial Vehicles
  • Tech
    • Mobiles
    • Gadgets
    • Reviews
    • Tips and Tricks
    • Apps
  • Real Estate
    • Home Buyers
    • Builders
  • Axis MF
  • Trending
    • Entertainment
    • Politics
    • Lifestyle
    • Travel
    • Sports
    • Viral
    • Education
    • Jobs
Read in App
Business News » India News

Labour Ministry wants to retain 8.8% interest on EPF for FY17

  • Twitter
  • Facebook
  • Linkedin
  • whatapp
  • View in App
Labour Ministry wants to retain 8.8% interest on EPF for FY17
The Finance Ministry had earlier this year decided to lower interest on EFF for 2015-16 to 8.7 % from the 8.8 %. Photo of Labour Minister Bandaru Dattatreya. Image Source: IANS

The Labour Ministry is pitching for retaining 8.8 % interest rate on EPF deposits of over 4 crore subscribers of the retirement fund body EPFO for 2016-17 and trying to bring the Finance Ministry on board.

The Finance Ministry had earlier this year decided to lower interest on EFF for 2015-16 to 8.7 % from the 8.8 % approved by the Employees' Provident Fund Organisation's apex decision making body, the Central Board of Trustees (CBT), which is headed by the Labour Minister.

The government had to roll back the decision and provided 8.8 % rate of interest on EPF deposit for last fiscal following protests by trade unions.

This time, according to sources, the Labour Ministry wants to avoid such a situation and is seeking the Finance Ministry's informal approval over the issue in advance. The CBT is scheduled to meet on Monday where the issue of interest rate is listed on the agenda.

As per the practice, CBT decides interest rate, which is later notified by the Finance Ministry after its concurrence. This is necessary to give tax exemption on EPF deposits, accrual of interest and withdrawals.

"In order to avoid any uproar on interest of EPF, Labour Minister Bandaru Dattatreya has recently met Finance Minister Arun Jaitley and Minister of State for Finance Arjun Ram Meghwal to convince the ministry for retaining 8.8 % rate of interest for the current fiscal as well," said a source.

As per the EPFO income projections of Rs 39,084 crore for the current fiscal, providing 8.8 % rate of interest on EPF deposits will leave a deficit of Rs 383 crore. There would be a surplus of about Rs 69.34 crore if interest rate is lowered to 8.7 %.

However, the source said: "Labour Ministry wants to utilise about Rs 409 crore surplus with the EPFO which accrued after providing 8.8 % rate of interest for the last fiscal."

There were speculations that Labour Ministry may align the EPF interest rate for the current fiscal with other small saving schemes of the government like Public Provident Fund after nudging by the Finance Ministry.

In September, the government had decided to reduce the interest rates on small savings schemes marginally by 0.1 % for the October-December quarter of 2016-17, which resulted in lower returns on PPF, Kisan Vikas Patra, Sukanya Samriddhi Account, among others.

The rate of interest on popular PPF was reduced to 8 % in the third quarter of the current fiscal as against 8.1 % in the previous three-months period.

Similarly interest rate on Kisan Vikas Patra has been brought down to 7.7 % from 7.8 %. As a result the KVP will now mature in 112 months instead of 110 months.

The source said the Labour Ministry has also pointed out in its discussions with the Finance Ministry that the income projections for the current fiscal did not factor in the returns on its investments of around Rs 10,000 crore so far in Exchange Trade Funds as there is no mechanism to do that.

The source further said that unless EPFO liquidates the ETF investments, there could not be any income from it especially in a scenario where EPFO has no exit (sale) policy for these. 

 

Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.

TAGS:
Labour MinistryEPFOInterest RatesEmployees Provident FundEconomyFinance Ministry
Written By: PTI
Updated: Thu, Dec 15, 2016
04:04 pm
PTI
RELATED NEWS
Neither scientific nor under global norms: Govt rebuts survey-based news on high unemployment Neither scientific nor under global norms: Govt rebuts survey-based news on high unemployment
Moonlighting: 'Worker shall not take...' - What Government said in Parliament Moonlighting: 'Worker shall not take...' - What Government said in Parliament
New Wage Code: Industry stakeholders agree to cap allowances at 50% - details New Wage Code: Industry stakeholders agree to cap allowances at 50% - details
EPFO Payroll Data May 2022: Check new subscribers added by retirement fund body EPFO Payroll Data May 2022: Check new subscribers added by retirement fund body
Labour Code update: Draft rules ready with states; What will change after rollout? Labour Code update: Draft rules ready with states; What will change after rollout?

LATEST NEWS

Meta share price rockets 24% - here is why

Tata Consumer Products Q3 Results: net profit jumps 25.6% to Rs 364 crore

ITC Q3 results today; here's what to expect in cigarette maker's earnings report

Amul milk price hiked by Rs 3 per litre from today: Check new rates

Redington Q3 results: Company records standalone Q3 net at Rs 141.38 crore

OPPO Reno 8T 5G launch today: Check specifications, features and other details

Mumbai-Solapur, Mumbai-Shirdi Vande Bharat Express: Trains to reach Mumbai this week ahead of inauguration on Feb 10 - Check route and other details

NSE, BSE put 3 Adani Group companies under short-term additional surveillance measure

Bajaj Electricals Q3 Results: Profit up 27% at Rs 61 crore

Ambuja Cement, ACC say no shares pledged by promoter Adani group

  • India News
  • World News
  • Companies News
  • Market News
  • Personal Finance News
  • Technology News
  • Automobile News
  • Small Business News
  • Income Tax Calculator
  • Live TV
  • Videos
  • Photos
  • Author
  • Rss Feed
  • Advertise with us
  • Privacy Policy
  • Legal Disclaimer

Latest Trending Updates

  • EPFO
  • Budget 2020
  • Income Tax Return
  • Auto Expo 2020
  • Home Loan
  • Business News

Trending Topics

  • Income Tax
  • income Tax Calculator
  • 7th Pay Commission
  • Reserve Bank of India
  • GST
  • Latest Business News

Follow us on

zeebiz
zeebiz

Partner Sites

  • Zee News
  • Hindi News
  • Marathi News
  • Bengali News
  • Tamil News
  • Malayalam News
  • Gujarati News
  • Telugu News
  • Kannada News
  • DNA
  • WION
© 2023. India Dot Com Private Limited. All Rights Reserved.
LIVE TV