Govt raises EPF interest rate to 8.8% for 2015-16

In the third roll-back in two months, the government today raised the interest rate on employee provident fund (EPF) contributions to 8.8 percent for 2015-16 against 8.7 percent approved by the Finance Ministry last week.

Labour Minister Bandaru Dattatreya announced the decision to raise interest rate on a day employee unions had called nationwide protests against fixing interest rates lower than 8.8 percent decided by the retirement fund body EPFO as well as 8.75 percent paid for the previous fiscal.

"I am happy that finance ministry has agreed to 8.8 percent for 2015-16," he told reporters here.

This is the third rollback on EPF. Last month the government was forced to withdraw the Budget proposal to tax a certain portion of withdrawals. Subsequently, it withdrew tighter withdrawal norms.