Opinion - Letters to the Editor

Widening tax net

Sir, — The 2002 budget is a big blow to retired citizens in general. Not only have the interest rates on investments been slashed to a very low level, such interests, which hitherto enjoyed tax exemption, have been brought under the tax net.

Quite a large number of retired people invest their retirement benefits either in RBI's `relief bond' at nine per cent tax-free interest or in the UTI's `monthly income plan' under similar condition. This year, the only investment to escape the Finance Minister's scalpel was the `relief bond'.

All other saving accruing investments have been made so unattractive that the returns from such investments have been almost halved.

For instance, the interest rate of MIP (UTI) has been brought down to 5 per cent, which is marginally higher than the savings bank interest rate.

Moreover, this interest has been brought under the net. In other words, an investor in MIP (UTI) has been subjected to double surgery. How will the retired people survive?

J. Dasgupta,
Coimbatore, T.N.

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