Interim Budget 2024: Govt may announce steps to promote NPS?

Govt is thinking on ways to entice people to join NPS. Regarding tax breaks for employer payments, Pension Fund Regulatory & Development Authority has asked for "parity" with EPFO.

Finance Minister Nirmala Sitharaman will unveil the interim budget on February 1 and that it would contain some announcements in this respect.

Disparity in employers' contributions, wherein contributions up to 10% of basic salary & DA by corporate are exempt from tax for NPS contributions, while same is 12% in EPFO case.

To promote long-term savings through NPS, annuity portion of NPS should be made tax free for holders from age of 75 years, according to Deloitte Budget expectations.

NPS can be included along with interest and pension to ensure that senior citizens above 75 years of age do not have to file returns if they have NPS proceeds, it said.

As of now, an individual's contribution of up to Rs 50,000 to the NPS under Section 80CCD (1B) as deduction under the old tax regime but not under the new tax regime.