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Editorial vocab dose 19 The Hindu by Ajay Sir

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Facing MOUNTING(increasing, बढ़ते हुए) criticism, the Narendra Modi government at the Centre has decided to drop its Budget proposal to tax a portion of the EPF (Employees’ Provident Fund) corpus upon withdrawal. An ILL-CONCEIVED(not carefully planned or considered,बुरी कल्पना ) move both context– and content-wise, it has DESERVEDLY(it deserve it to happen,यथायोग्य) been given a BURIAL [the act of putting something into the ground (unwanted things / dead bodies)दफन]. “In view of the representations received, the government would like to do a COMPREHENSIVE[complete (including everything that is necessary)विस्तृत] review of this proposal, and, therefore, withdraw the proposal in paragraph 138 and 139 of my Budget speech,’’ Finance Minister Arun Jaitley said in a statement in the Lok Sabha. The government has also withdrawn the proposal to limit tax-free contributions by the employer to the provident fund account of an employee to Rs.1.5 lakh a year. This did not gel with the Budget speech RATIONALE(the reasons that cause a particular set of beliefs or actions, तर्क) for taxing EPF savings —to bring PARITY(the condition of being equal,समानता) in tax treatment between the EPF and the National Pension System (or NPS, where employers can pay up to 10 percent of salary as contribution without any such cap). By putting the EPF back into an EEE tax REGIME(a system or ordered way of doing things, व्यवस्था) (where contributions, income as well as the accumulated corpus are all exempt from tax), the government’s VOLTE-FACE(a sudden change in an action / policy which is completely opposite,पक्ष परिवर्तन) would help retain the EPF’s popularity among the salaried class, most of whom are part of it not out of choice but by statutory default. The Finance Minister had himself called them HOSTAGE(something that is controlled by an outside influence,बंधक) to the EPF in his last Budget, but instead of setting them free, he thought it better to tax them citing fair taxation principles. It is still not clear whether the government had initially thought it could pull the taxation proposal past its middle-class constituency. In the event, the tax on EPF withdrawal gave additional AMMUNITION[facts that can be used to support your argument (especially to defeat opponents),सबूत जो वाद विवाद में मदद करे] to an aggressive Opposition, including the Congress party. Differences within the National Democratic ALLIANCE(a union or association formed for mutual benefit, संधि) and the Cabinet finally ensured the climbdown by the Finance Ministry. While announcing a return to STATUS QUO(the present situation,यथास्तिथि) on the EPF, the Finance Minister has rightly retained the Budget provision allowing NPS subscribers to withdraw 40 per cent of the corpus without any tax liability. The remainder 60 per cent will attract a combination of withdrawal tax and deferred tax on the ANNUITY(a fixed sum of money paid to someone each year, for the rest of their life,वार्षिकी) products one buys. In a way, partial tax relief for the NPS will narrow the existing tax-induced gap between the EPF and the NPS. The STRIDENT[loud and harsh,कठोर] opposition to EPF tax must be read in the context of the virtual absence of a social security net of any worth in India. There are no two views on the need to move towards a ‘pensioned society’. However, this cannot happen abruptly or in a coercive manner — people need to be nudged over time to gear up for such transitions. Whatever the intention, it was the ‘out-of-the-blue’ approach of the government that triggered an UPROAR(a situation in which a lot of people complain about something angrily,कोलाहल). A SHEEPISH(embarrassed because you know that you have done something wrong or silly,ढब्बू) rollback is a smart move, ahead of a round ofAssemblyelections. It is to be hoped that this U-turn will trigger a larger debate on ushering in a HOLISTIC( dealing with or treating the whole of something or someone and not just a part,समग्र) social security ecosystem in the country.

courtesy:The Hindu

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