Indian budget 2016 has one change to Employee Provident Fund. As per the news it says
It is only the interest on contributions made after April 1, 2016 which will be taxed
The same is said in this news.
However some article online suggest that this may cause individual who is 25 year old currently may loose as much as 18% of his/her PF corpus by his retirement. Specifically check this image: on this page.
In right most column, second cell from top, it ends up saying individuals with current age 25 years will lose upto 20% of saving under tax.
- Are these calculations correct?
I feel that all these news of loosing 20% of PF corpus under tax have calculated tax on 60% of full corpus, but not on interest on 60% of full corpus. But then many news say that we will be loosing 20% of total corpus.
- What is correct?