“It will not have much impact on us. The investments in the National Pension System are made by our trust (NPS Trust) which is a tax-exempted body. As far as pension investments are concerned, LTCG will not have an impact,” NPS regulator PFRDA chairman Hemant Contractor said here yesterday
However, it will have an impact on tier II accounts also known as non-pension account, he said.
NPS manages two types of accounts tier I and tier II.
“Tier II has no tax benefits. Tier II account would be impacted but investments corpus in tier II is much smaller,” Contractor said.
The Budget 2018 had proposed to re-introduce long-term capital gains tax on gains arising from the transfer of listed equity shares exceeding Rs 1 lakh at 10% (excluding cess). The same also implies on mutual funds.
The total NPS corpus is currently at Rs 2.25 lakh crore from a base of two crore subscribers.
“Our subscriber base is growing by 27-28% a year. We just touched two crore subscribers mark. In March, there were about 1.54 crore subscribers. We expect to maintain the same pace of growth next year,” Contractor said.
PFRDA also expects that its Asset Under Management (AUM) would grow by 45-47% in the next year.
Speaking on the Atal Pension Yojana, he said the pension fund body has the target of reaching one crore subscribers under the Yojana by 31 March.
“We currently have about 88 lakh subscribers with Rs 4,000 crore and we are trying hard in the remaining days of the year to touch the target. Next year, we will try for another 50 lakh,” the PFRDA chief said.