PFRDA seeks parity with EPFO on tax exemption

The Pension Fund Regulatory and Development Authority (PFRDA) has sought a level-playing field for corporations in making contributions to the National Pension Scheme (NPS) so that they are at par with contributions made in provident fund (PF) for employees in respect of tax treatment.

Currently, the tax exempt contribution is capped at 10 per cent for NPS while it is 12 per cent for PF.

The authority has made a case for bringing parity (between NPS and PF) to support growth of pension products, said Deepak Mohanty, chairman PFRDA, in reference to Budget expectations for 2024-25.

The plan is to take it to 14 per cent over a period to encourage wider acceptance of pension, he added.

Referring to subscribers enrolled in the current financial year (FY24), Mohanty said their number stood at 0.53 million. This included 99,977 corporates and 429,187 citizens, as of December 31, 2023.