Centre makes 60% pension withdrawal tax free, raises govt contribution to 14%

Agencies
December 10, 2018

New Delhi, Dec 10: Elaborating on taxability of fund under National Pension Scheme, the government on December 10 said that the entire 60 percent of the corpus withdrawn at the time of retirement will now be tax free.

"Earlier, while exiting the fund (at the time of retirement), 60 percent (of the corpus) was allowed to be withdrawn and the rest went to annuity. Of this 60 percent, 40 percent was tax free and 20 percent was taxable... Now, this entire 60 percent is tax free," Finance Minister Arun Jaitley told reporters.

He said that both entry stage contribution and 60 percent of the withdrawal amount is tax exempt.

"At present, 40 percent of the total accumulated corpus utilised for purchase of annuity is already tax exempted. Out of 60 percent, of the accumulated corpus withdrawn by the NPS subscriber at the time of retirement, 40 percent is tax exempt and balance 20 percent is taxable," statement by the ministry said.

Cabinet Committee of Economic Affairs, on December 6 approved amendments to the National Pension Scheme (NPS) and decided to increase the government's contribution, in the NPS tier - I, to 14 percent from 10 percent.

The amendment will be applicable for all the employees registered under the scheme after 1st January 2004. This number is expected to be 18 lakh.

The scheme will be notified (come into effect) from next financial year, once amendment to Finance Bill is passed.

"The exact date will be notified after the amendment to Finance bill (are passed by the Parliament)," Jaitley said.

According to government estimates, this would cost Centre close to Rs 2,840 crore in FY20.

Providing further tax relief to employees under NPS Tier-II scheme, the cabinet cleared applicability of Section 80C of Income Tax Act to such employees.

"Contribution by the Government employees under Tier-II of NPS will now be covered under Section 80 C for deduction up to Rs 1.50 lakh for the purpose of income tax at par with the other schemes such as General Provident Fund, Contributory Provident Fund, Employees Provident Fund and Public Provident Fund provided that there is a lock-in period of three years," the statement said.

The Cabinet, headed by Prime Minister, Narendra Modi, also approved various investment options for the employees.

Subhash Chandra Garg, secretary, Department of Expenditure, said that the employees would now have options to invest in various schemes from the accumulated corpus.

"There is a standard plan as per which certain amount is invested in government security, and certain amount is invested in equities or debt..." he said adding, "This debt oriented fund, which was limited up to 15 percent, will now have various options...".

The Secretary said that an employee could choose to invest up to 25 percent in equity or up to 50 percent in equities or take up "conservative" approach of investing 100 percent in equity.

"Each government employee will now have option of various fund managers... The three fund managers from the public sector and five from private sector," he said.

The eight NPS fund managers are Birla Sun Life Pension Scheme, HDFC Pension Fund, ICICI Prudential Pension Fund, Kotak Pension Fund, LIC Pension Fund, Reliance Capital Pension Fund, SBI Pension Fund and UTI Retirement Solutions.

Jaitley also said that all the employees who reported anomalies, between 2004 and 2012, in deposits, either due to delayed deposit or no-deposit will be compensated as per the new scheme.

"The cost of compensation will be over and above the cost estimated for 2019-20," government said.

The recommendations have come after a report was submitted, early in 2018, by committee of secretaries to suggest ways to streamline NPS.

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News Network
March 26,2020

New Delhi, Mar 26: Ujjwala beneficiaries will get free gas cylinders (LPG cylinders) in the next three months, Finance Minister Nirmala Sitharaman announced on Thursday. Addressing a press briefing amid coronavirus pandemic, the finance minister said the announcement is set to benefit 8.3 crore BPL families. 

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Agencies
May 21,2020

More than 50 million people in India do not have access to effective handwashing, putting them at a greater risk of acquiring and transmitting the novel coronavirus, according to a study.

Researchers from the Institute for Health Metrics and Evaluation (IHME) at the University of Washington in the US found that without access to soap and clean water, over 2 billion people in low- and middle-income nations -- a quarter of the world's population -- have a greater likelihood of transmitting the coronavirus than those in wealthy countries.

According to the study, published in the journal Environmental Health Perspectives, more than 50 per cent of the people in sub-Saharan Africa and Oceania lacked access to effective handwashing.

"Handwashing is one of the key measures to prevent COVID transmission, yet it is distressing that access is unavailable in many countries that also have limited health care capacity," said Michael Brauer, a professor at IHME.

The study found that in 46 countries, more than half of people lacked access to soap and clean water.

In India, Pakistan, China, Bangladesh, Nigeria, Ethiopia, Democratic Republic of the Congo, and Indonesia, more than 50 million persons in each country were estimated to be without handwashing access, according to the study.

"Temporary fixes, such as hand sanitizer or water trucks, are just that -- temporary fixes," Brauer said.

"But implementing long-term solutions is needed to protect against COVID and the more than 700,000 deaths each year due to poor handwashing access," Brauer said.

He noted that even with 25 per cent of the world's population lacking access to effective handwashing facilities, there have been "substantial improvements in many countries" between 1990 and 2019.

Those countries include Saudi Arabia, Morocco, Nepal, and Tanzania, which have improved their nations' sanitation, the researchers said.

The study does not estimate access to handwashing facilities in non-household settings such as schools, workplaces, health care facilities, and other public locations such as markets.

Earlier this month, the World Health Organization predicted 190,000 people in Africa could die of COVID-19 in the first year of the pandemic, and that upward of 44 million of the continent's 1.3 billion people could be infected with the coronavirus, the researchers said. 

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News Network
July 24,2020

New Delhi, Jul 24: The Delhi High Court on Friday asked the ICMR to come out with a clarification that mobile number, government-issued identity card, photographs or even a residential proof ought not to be insisted upon for Covid-19 test of mentally ill homeless persons.

According to an Indian Council of Medical Research (ICMR) advisory of June 19, every person who was to be tested for Covid-19 has to provide a government-issued identity proof and should have a valid phone number for tracing and tracking the individual and his/her contacts.

A bench of Chief Justice D N Patel and Justice Prateek Jalan said that ICMR should issue a clarification by way of a circular or an official order that the identity proof, address proof and mobile number are not required for testing mentally ill homeless persons.

The high court said a camp can be organised for testing such persons as is being done across Delhi for others.

"Guidelines have to be given by you (ICMR). You put it in black and white for the states'' benefit. You only need to clarify in two-three lines that mobile number, address proof and identity cards are not required for testing mentally ill homeless persons," it said.

"Use your powers for the public at large. Once you do so (issue the clarification), all states will comply," the bench added.

Additional Solicitor General Chetan Sharma, appearing for ICMR, sought time to take instructions from the government regarding the observations made by the bench.

The high court, thereafter, listed the matter for further hearing on August 7.

The bench was hearing a PIL moved by advocate Gaurav Kumar Bansal seeking directions to ICMR and Delhi government to issue guidelines for Covid-19 testing of mentally ill homeless persons in the national capital.

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The high court on July 9 had asked the ICMR to consider the plight of the mentally ill homeless persons and see whether they can be tested without insisting upon a mobile number, government issue identity card and residential address proof.

The bench had said to ICMR that many homeless mentally ill persons are institutionalised or in shelter homes and therefore, traceable, so there was no need for their identity proof or phone numbers to test them for Covid-19.

In response to the court''s query, ICMR has filed an affidavit stating that the purpose behind the submission of government identity card and telephone number was to ensure proper tracking and treatment of positive cases and their contacts as ''Test/Track/Treat'' is the best strategy for control of Covid-19 pandemic. 

It further said that since health was a state subject, the concerned state health authority may consider adopting a suitable protocol to ensure that the strategy of ''Test/Track/Treat'' is followed and the grievance raised in the PIL is also addressed.

ICMR, in its affidavit, has said that it has only advised facilitating contact tracing as well as tracking of the Covid-19 infected patients.

"The modalities regarding the contact tracing as well as tracking of the Covid-19 infected patients completely falls under the domain of IDSP. NCDC and state health authorities. 

"ICMR is a research organization and the contact tracing, as well as tracking of the Covid-19 infected patients, is not under the domain of ICMR," it has said in its affidavit.

Bansal has claimed in his petition that the Delhi government has not taken seriously the lack of guidelines with respect to Covid-19 testing of mentally ill homeless persons.

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He has said the high court had on June 9 directed it to address the grievances raised by him in another PIL with regard to mentally ill homeless persons in accordance with law, rules, regulations and government policy.

He said that on June 13 he also sent a representation to the Chief Secretary of Delhi government for providing treatment to mentally ill homeless persons in the national capital who have no residence proof. 

However, nothing was done by the Delhi government, he had told the court.

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