No change in 15-pct interest to Senior Citizens’ Savings Accounts: Finance Ministry

Aug 05, 2019 (LBO) – Although the Central Bank has reduced the rates for deposits maintained in commercial banks, the special interest rate of 15 percent offered by the Government for senior citizens have not been changed.

“There is no truth in the media reports published by different media saying that the 15% special bank interest rate which has granted by the Government for senior citizens has been reduced,” the Finance Ministry said.

The special interest rate of 15 percent that has been granted for the fixed deposits which are maintained by senior citizens was introduced by Budget 2015 and, it has been continuing with effective from 13.03.2015 without any change to it.

The income from the interest of senior citizens up to one million rupees was exempted from withholding tax by Budget 2015.

Budget 2018 increased the threshold of this interest income for senior citizens up to 1.5 million rupees.

Accordingly, with the aim of continuing further the concessions to senior citizens, the annual interest income of senior citizens up to 1.5 million rupees has been exempted from withholding tax.

“Without any change, The Treasury has been paying nearly 16 billion rupees annually to commercial banks to provide an increased interest rate of 15 percent to senior citizens.”