On 12 september 2017 Central Government hiked dearness allowance of employees to 5 percentage. This means that there has been an increase of 1 % DA from existing 4 percentage. Central Government employees DA hike on 12/9/2017 was a great relief to them. These new changes in DA was announced by Union minister Ravi Shankar Prasad.
New hike in Central DA as on 12-9-2017 will be beneficial for Central Government employees and pensioners. Along with this Goverment decided to increase Tax free gratuity limit for Private sector employees from existing rupees 10 lakshs to 20 lakhs. Central Government employees DA hike as on September 2017 is benefiting around 49 lakh 26 thousand staff. Along with this around 61 lakh 17 thousand pensioners will also get benefit.
Increase in dearness allowance from 4% to 5% was welcomed by employees in current situation of increase in living expenses. New dearness allowance revision will come into effective from salaries as on 1st July 2017. This is the first Cabinet meeting of Central Government after reshuffle of ministers last month. Indian Prime Minister Narendra Modi took these decisions at the cabinet meeting.
Increasing Dearness Allowance for Central Government employees will create an additional early financial burden of Rs 3,068.26 crore.
Central government employees DA hike
Decision of cabinet to increase tax free limit of gratuity amount received by private sector employees was taken after considering present inflation in India. Now private employees can get gratuity of upto Rs. 20 lakhs without deducting taxes. Earlier this limit was only up to rupees 10 lakhs.
News – Gratuity ceiling limit hike
New gratuity revision as on 12th Sept 2017 regarding law under Payment of Gratuity Act 1972 will be helpful to private sector employees working in Companies, industries, factories and establishments.
Increasing gratuity ceiling for employees to Rs 20 lakhs was a main recommendation of 7th Central Pay Commission (7th CPC).
Union cabinet decision on Tuesday 12th September 2017 to hike 1% Dearness Allowance to Central Govt employees & Dearness Relief to pensioners will be effective as on 01.07.2017.
Last Central Government employees DA hike was by 6 % in 2016 and based on that employees were getting 125 percentage of basic pay. This DA was merged into basic pay after implementation of the Pay Commission based pay revision.