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Govt may revise PF rate upwards: CPI
June 05, 2004 17:43 IST
The Union government may consider the demand for revising upwards interest rates on Employees Provident Fund in the face of forceful plea from major trade unions during their pre-Budget meeting with Finance Minister P Chidambaram on Saturday.
"I believe the finance minister is in a mood to reconsider returns on EPF in an upward direction," Comunist Party of India leader and All India Trade Union Congress General Secretary Gurudas Das Gupta told reporters in New Delhi after the meeting.
He said the minister assured that "in the Budget some of your views will be reflected."
While Communist Party of India (Marxist)-led Centre of Indian Trade Unions had demanded restoration of as high as 12 per cent interest rate on all small saving schemes including Employees Provident Fund, Public Provident Fund and General Provident Fund, AITUC has suggested that EPF rates should be revised upwards to 9.5 per cent.
Under pressure from the finance ministry during the National Democratic Alliance regime, EPF rates were lowered to 9.0 per cent but Golden Jubilee bonus of 0.5 per cent was given for one year, to virtually retain the 9.5 per cent rate.
Apparently soft-peddling on the issue, Congress-backed Indian National Trade Union Congress wanted a re-look on EPF investment pattern so that workers can get better returns on their savings.
It said because PF investments are restricted to only low yielding government securities and bonds, it appears that the rates may be slashed further from the present rate.The unions have also demanded doubling of Income-Tax exemption limit to Rs 100,000, re-look at the privatisation policies, cut in prices of petroleum products, improving tax administration and collection and implementation of value added tax.