National Pension System to DA Hike: Modi government puts more money in people's pocket - 5 decisions from 2018
The year 2018 is at its fag end. Right from Union Budget 2018 to 7th pay commission related pay hike, PM Narendra Modi-led Union government has announced several measures to put more money into people's pocket.
The year 2018 is at its fag end. Right from Union Budget 2018 to 7th pay commission related pay hike, PM Narendra Modi-led Union government has announced several measures to put more money into people's pocket. The moves have not only benefitted the government servants but also helped private and contractual employees like Anganwadi and Asha workers. Take a look at the some of the decisions made by the Modi Cabinet and the government in 2018:
1. Standard Deduction of Rs 40,000: Finance Minister Arun Jaitley had introduced a Standard Deduction of Rs 40,000 in the Union Budget 2018. However, this abolished existing transport allowance of Rs 19,200 and medical allowance of Rs 15,000 per annum. This has reduced the net taxable income marginally for salaried persons.
2. NPS and tax exemption on withdrawal: Union Cabinet approved enhancement of the mandatory contribution by the Central government for its employees covered under National Pension System (NPS) Tier-I from the existing 10% to 14%. It has also enhanced tax exemption limit for lump sum withdrawal on exit to 60%. With this, the entire withdrawal will now be exempt from income tax.
Also, the contribution by the Government employees under Tier-II of NPS will now be covered under Section 80 C for deduction up to Rs 1.50 lakh.
3. Social security and pension to senior citizens: The Union Cabinet chaired by PM Narendra Modi have approval for for extending the investment limit from Rs 7.5 lakhs to Rs 15 lakhs as well as extension of time limits for subscription from 4th May 2018 to 31st March, 2020 under the Pradhan Mantri Vaya Vandan Yojana (PMVVY).
Further, as a boost to the Social Security initiatives of senior citizens, the investment limit of Rs 7.5 lakh per family in the existing scheme was enhanced to Rs 15 lakh per senior citizen in the modified PMVVY. It will enable up to Rs 10,000 Pension per month for Senior Citizens. As of March, 2018, a total number of 2.23 lakh senior citizens are being benefited under PMVVY.
4. Remuneration hike for ASHA workers: The government also approved the increase in supervisory visit charges for ASHA Facilitators from Rs 250 per visit to Rs 300 per visit for 2018-2019 to 2019- 2020 w.e.f from October 2018 (to be paid in November 2018). ASHA facilitator will undertake about 20 supervisory visits per month. With the proposed increase, ASHA Facilitators would receive about Rs 6000 per month against Rs 5000 per month. This is applicable to 41,405 ASHA facilitators.
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5. Dearness Allowance hike: The Modi government had also given more money to the central government employees by releasing an additional installment of Dearness Allowance (DA) and Dearness Relief (DR) to pensioners w.e.f. 01.07.2018 representing an increase of 2% over the existing rate of 7% of the Basic Pay/Pension, to compensate for price rise. This has put an additional burden of Rs 6112.20 crore per annum and Rs 4074.80 crore in the financial year 2018-19 (for a period of 08 months from July, 2018 to February 2019).