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P.S. Sundar

Coonoor, Nov. 4 The Nilgiris Small Tea Growers’ Association has appealed to the Union Finance Minister, Mr P. Chidambaram, to abolish Tax Deduction at Source (TDS) on interest paid on bank deposits.

“The Prime Minister and Finance Minister are advising people to go for bank deposits claiming that they are secure. Asserting that India’s economic fundamentals and banking base are strong despite the global fiscal crisis, they want people to save in banks. Given the high volatility of the stock markets, people are forced to choose bank deposits for their investments. But, banks continue to levy TDS on interest of Rs 10,000 per year. At current rates of 10 to 12 per cent interest per annum, even a deposit of less than Rs 1 lakh suffers TDS on interest. But, a lakh of rupees is too small a sum for term deposits these days,” the Association President, Mr T. Rangaiah, told Business Line.

“TDS is a deterrent to investors. Its cost of collection is incommensurate with the actual collection. So, we have requested the FM to abolish TDS on bank interest immediately,” he said.

More Stories on : Tea | Fixed Deposits | Tamil Nadu

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