Proposal for tax-free plan for pension for all categories
Pension fund regulator PFRDA will propose to the government to make employers’ contribution of 14 per cent under NPS tax free for all categories of subscribers in the next budget, chairman Supratim Bandyopadhyay said.
Employers’ contribution of 14 per cent in pension under the National Pension System (NPS) scheme for the central government employees was made tax-free from April 1, 2019.
“We may propose things like 14 per cent contribution by employers to be made tax free to all. At present, it is given only to the central government employers. So we are requesting the government to give it to all the employers, whether it is state governments or other corporate entities, so that subscribers across the board can get this benefit,” Bandyopadhyay said.
The PFRDA chairman said states are asking that the 14 per cent tax benefit be given to state government employees also. He said some state governments have written to the authority requesting the same.
Besides, the Pension Fund Regulatory and Development Authority (PFRDA) will ask the government to extend the benefit of tier-II NPS account as tax-free for all subscribers.
Recently, the facility was granted to the central government employees.