Para 85. (i) Foreign investment will be allowed in the insurance and pension sectors in the automatic route up to 49% subject to the extant guidelines on Indian management and control to be verified by the Regulators.
Para 137. Pension schemes offer financial protection to senior citizens. I believe that the tax treatment should be uniform for defined benefit and defined contribution pension plans. I propose to make withdrawal up to 40% of the corpus at the time of retirement tax exempt in the case of National Pension Scheme.
Para 138. In case of superannuation funds and recognized provident funds, including EPF, the same norm of 40% of corpus to be tax free will apply in respect of corpus created out of contributions made after 1.4.2016.
Para 139. Further, the annuity fund which goes to the legal heir after the death of pensioner will not be taxable in all three cases. Also, we are proposing a monetary limit for contribution of employer in recognized Provident and Superannuation Fund of Rs.1.5 lakh per annum for taking tax benefit.
Para 140. I propose to exempt from service tax the Annuity services provided by the National Pension System (NPS) and Services provided by EPFO to employees.
Annexure to Part B of Budget Speech
Para 2 (2.1). It is proposed to provide a uniform tax treatment to the recognised provident fund, national pension system and superannuation fund. Accordingly, the following are proposed:-
Any amount received by the nominee, on the death of the employee at the time of closure of account under National Pension System referred to in section 80CCD of the Income-tax Act is proposed to be exempt.
Exemption is proposed to be provided for one-time portability from a recognised provident fund or superannuation fund to National Pension System.
It is proposed that 40% of the pension wealth received by an employee from the National Pension System Trust shall be exempt.
Budget Speech 2015-16
Para 7.7 It is proposed to increase the limit of deduction u/s 80CCD of the Income tax Act on account of contribution by the employee to National Pension Scheme (NPS) from Rs. 1 lakh to Rs. 1.50 lakh. It is also proposed to provide a deduction of upto Rs. 50,000 over and above the limit of Rs. 1.50 lakh in respect of contributions made to NPS.
Para 39. A large proportion of India’s population is without insurance of any kind - health, accidental or life. Worryingly, as our young population ages, it is also going to be pension-less. Encouraged by the success of the Pradhan Mantri Jan Dhan Yojana, I propose to work towards creating a universal social security system for all Indians, specially the poor and the under-privileged. 40. The soon-to-be-launched Pradhan Mantri Suraksha Bima Yojna will cover accidental death risk of `2 lakh for a premium of just `12 per year. Similarly, we will also launch the Atal Pension Yojana, which will provide a defined pension, depending on the contribution, and its period. To encourage people to join this scheme, the Government will contribute 50% of the beneficiaries’ premium limited to `1,000 each year, for five years, in the new accounts opened before 31st December, 2015.S
Para 62. With respect to the Employees Provident Fund (EPF), the employee needs to be provided two options. Firstly, the employee may opt for EPF or the New Pension Scheme (NPS). Secondly, for employees below a certain threshold of monthly income, contribution to EPF should be optional, without affecting or reducing the employer’s contribution. With respect to ESI, the employee should have the option of choosing either ESI or a Health Insurance product, recognized by the Insurance Regulatory Development Authority (IRDA). We intend to bring amending legislation in this regard, after stakeholder consultation.
Para 125. Madam Speaker, the fifth pillar of my taxation proposals this year is extension of benefits to middle class tax payers. The proposals in this regard are as follows :
• The limit on deduction on account of contribution to a Pension Fund and the New Pension Scheme is proposed to be increased from Rs. 1 lakh to Rs. 1.5 lakh.
• To provide social safety net and the facility of pension to individuals, an additional deduction of Rs. 50,000 is proposed to be provided for contribution to the New Pension Scheme under Section 80CCD. This will enable India to become a pensioned society instead of a pension less society.
Budget Speech 2012-13
Para 119. In order to promote voluntary savings towards pensions, a co-contributory scheme SWAVALAMBAN was started in September, 2010. Over 5 lakh subscribers have been enrolled by February 2012. In order to enhance access to this scheme, LIC has been appointed as an Aggregator and all Public Sector Banks have also been appointed as Points of Presence (PoP) and Aggregators.
Budget Speech 2013-14
Para 91. The Insurance Laws (Amendment) Bill and the PFRDA Bill are before this House. I sincerely hope that Government and the Opposition can arrive at a consensus and pass the two Bills in this session.
Budget Speech 2014-15
Para 28. The PFRDA Act was passed placing the New Pension System on a statutory basis and establishing a statutory regulator.
Budget Speech 2011-2012
Para 34 (iii)
The financial sector reforms initiated during the early 1990s have born good results for the Indian economy. The UPA Government is committed to take this process further. Accordingly, I propose to move the following legislations in the financial sector:
….(iii) The revised Pension Fund Regulatory and Development Authority Bill, first introduced in 2005;
I had announced a co-contributory pension scheme 'Swavalamban' in the Budget 2010-11.This scheme has been welcomed by the workers in unorganized sector. Over 4 lakh applications have already been received. On the basis of the feedback received, I am relaxing the exit norms whereby a subscriber under Swavalamban will be allowed exit at the age of 50 years instead of 60 years, or a minimum tenure of 20 years, whichever is later. I also propose to extend the benefit of Government contribution from three to five years for all subscribers of Swavalamban who enroll during 2010-11 and 2011-12. An estimated 20 lakh beneficiaries will join the scheme by March 2012.
Budget Speech 2010-2011
Para No. 90
To encourage the people from the un-organised sector to voluntarily save for their retirement and to lower the cost of operations of the New Pension Scheme (NPS) for such subscribers, Government will contribute Rs. 1000 per year to each NPS account opened in the year 2010-11. This initiative, “Swavalamban” will be available for persons who join NPS, with a minimum contribution of Rs. 1000 and a maximum contribution of Rs. 12000 per annum during the financial year 2010-11. The scheme will be available for another three years. Accordingly, I am making an allocation of Rs. 100 crore for the year 2010-11. It will benefit about 10 lakh NPS subscribers of the un-organised sector. The scheme will be managed by the interim Pension Fund Regulatory and Development Authority.
Para No. 91
I also appeal to the State Governments to contribute a similar amount to the scheme and participate in providing social security to the vulnerable sections of the society.
Budget Speech 2006-2007
Banking, Insurance and Pensions
Para No. 90
Important Bills to amend the banking laws and for setting up the Pension Fund Regulatory and Development Authority are before Parliament. The Standing Committee on Finance has recommended these Bills. I would urge the Honourable Members to cooperate with the Government and pass these Bills.
Budget Speech 2005-2006
Para No. 84
With increasing longevity, the problem of old-age income security can no longer be ignored. Government had announced a defined contribution pension scheme for newly recruited Central Government employees which would also be extended to the unorganized sector. I am happy to inform the House that seven State Governments – Andhra Pradesh, Chhattisgarh, Himachal Pradesh, Jharkhand, Manipur, Rajasthan and Tamil Nadu – have introduced similar schemes for their employees. Other States have also evinced interest. An Ordinance was promulgated on December 29, 2004 to set up a Pension Fund Regulatory and Development Authority (PFRDA). I propose to introduce a Bill to replace the Ordinance during this session.
Para No. 85
Through the new scheme, it is proposed to offer a menu of investment choices to the subscriber and to provide a strong regulatory mechanism to ensure that the interests of subscribers are protected. I appeal to workers all over the country to join the new pension system.
Budget Speech 2004-2005
Para No. 70
A 'defined contribution' pension scheme for new entrants into Central Government Service has come into effect from January 01, 2004 for the Central Government employees recruited on or after the date. A suitable legislation to provide a regulatory framework for the scheme will be introduced in Parliament.
Para No. 100
A 'defined contribution' pension scheme for new entrants into Central Government Service has come into effect from January 01, 2004. The tax treatment of contributions made to the scheme has engaged the attention of Government. I propose to adopt the universally accepted formula of EET that is, the contributions will be excluded from income for tax purposes; the accruals will also be exempt from tax; and only the terminal benefits will be taxed at the applicable rate in the year of receipt.
Budget Speech 2003-2004
Restructured pension scheme
Para No. 44
My predecessor in office had, in 2001, announced a road map for a restructured pension scheme for new Central Government employees, and a scheme for the general public. This scheme is now ready. It will apply only to new entrants to Government service, except to the armed forces, and upon finalization, offer a basket of pension choices.It will also be available, on a voluntary basis, to all employers for their employees, as well as to the self-employed.
Para No. 45
This new pension system, when introduced, will be based on defined contribution,shared equally in the case of Government employees between the Government and the employees. There will, of course, be no contribution from the Government in respect of individuals who are not Government employees. The new pension scheme will be portable, allowing transfer of the benefits in case of change of employment, and will go into 'individual pension accounts' with Pension Funds. The Ministry of Finance will oversee and supervise the Pension Funds through a new and independent Pension Fund Regulatory and Development Authority.
Budget Speech 2002-2003
Para No. 67
Last year I had mentioned that the Insurance Regulatory and Development Authority (IRDA) would be asked to provide a road map for a new pension scheme so that the unorganized sector is provided adequate social security coverage. IRDA has recommended a regulatory framework for setting up pension funds to enable individuals to subscribe on a defined contribution basis to obtain the benefit of pensions on their retirement. Action on these recommendations will be taken by June 30, 2002.
Para No. 91
The present pension scheme for Government employees casts an open-ended financial burden on the Government. I had announced the appointment of a High Level Expert Group to develop a new pension scheme, based on defined contributions, for new recruits entering government service. The Expert Group has submitted its report to the Government. It has proposed a hybrid scheme that combines contributions from employees and the Union Government on matching basis, on the one hand, while committing to the employees a defined benefit as pension. The report is being considered by the Government and the new pension scheme for new recruits will be announced and implemented by June 1, 2002.
Budget Speech 2001-2002
Para No. 73
Whereas the organised sector is at present covered by various pension, provident fund and gratuity schemes, the unorganized sector does not have adequate social security coverage. I am asking the Insurance Regulatory Development Authority to look into all these issues and provide a road map for pension reforms by October 1, 2001.
Para No. 83
The Central Government pension liability has reached unsustainable proportions: as a percentage of GDP, it has risen from about 0.5 per cent in 1993-94 to 1 percent in 2000-2001. As such it is envisaged that those who enter central government services after October 1, 2001 would receive pension through a new pension programme based on defined contributions. In order to review the existing pension system and to provide a roadmap for the next steps to be taken by the Government, I propose to constitute a High Level Expert Group, which would give its recommendations within 3 months.