Just before you felt lucky enough that your Employees Provident Fund (EPF) account would fetch you some extra bucks, the Finance Ministry stepped in to have its share of the surplus ( 1,731 crore) unearthed by Employees Provident Fund Organisation (EPFO). No doubt that the surplus was due to the faulty accounting practices of the EPFO, the funds belong to the employees. It’s quite simple if your account has surplus it is you who should be benefited and not the Government, who is always on the look out to tax the common man in whichever way possible. It appears that the bottom line for government is to fill up the “tax-kitty”.

 

Instead of targeting the salaried class the Government should focus on the amount of black money that is being routed to fund various organisations. Since there is no lobby for the common man, we (common man) are like puppets in the hands of the government. Dancing on their (government) tunes.

 

If you see historically, the tax-free PF rate notified by the income tax department has never been lower than the EPF rate declared for the year, then why this year? Just because the EPFO unearthed a surplus of  1,731 crores and decided to distribute the same among its rightful beneficiaries, the tax authorities quickly notified that anything above 8.5% on EPF would be taxable, clearly indicating that they (tax authorities) want their share in the surplus in whichever way possible.

 

It’s high time that someone should take the onus of protecting the employee class, just as how SEBI is backing the investor community.

 

The hike in EPF to 9.5% thus, seems to be for name sake as the tax department has stepped in to have its share. The regulation seems to be at the mercy of the powerful authorities which can be twisted according to the whims and fancies of the regulatory authorities. This is evident from the fact that until now the tax-free PF rate notified by the income tax department has never been lower than the EPF rate declared for the year. The main beneficiaries (PF account holders) are always at the losing end of new policy regulations.

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