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10 March 2016

Indian government withdraws budget proposals to tax Recognized Provident Fund contributions and withdrawals

The Finance Minister of India has announced a reversal of the budget proposal to tax contributions to, and withdrawals from, Recognized Provident Funds ("RPF"). This reversal will ensure that the RPFs continue to be covered under the favorable EEE (Exempt-Exempt-Exempt) regime of taxation. Other budget proposals in respect of Superannuation Funds have also been reversed but the proposal to exempt 40% of National Pension Scheme withdrawals remains.

A Tax Alert prepared by Ernst & Young's Human Capital Group, and attached below, provides additional details.

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Document ID: 2016-0479

 

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