In this ongoing festive season, government has delighted salaried taxpayers by boosting their HRA. The decision was taken by the Committee on Allowances which was set up to settle ongoing issues on allowances. Government had earlier notified a 2.57-time hike in basic salary for over 1 crore government employees and pensioners at an estimated cost of 1.02 lakh crore.
The committee headed by Union Secretary, Finance which was set up on 22nd September examined 196 allowances after protests staged by the representatives of Employee Associations and other stake holders. Earlier, a panel headed by Justice A K Mathur had recommended abolition of 51 allowances and subsuming 37 others. This led to protests from various segments of salaried taxpayers after which government formed this committee to examine allowances other than Dearness Allowance and was given a time of 4 months to submit its report.
While the recommendations on other allowances is yet to come, the committee has proposed a hike of 120% on HRA which is more than double of what was proposed earlier. The proposed HRA is most likely to be implemented from October this year.
It is expected that proposal on other allowances under review will also be revealed in a couple of months. So enjoy the increment and celebrate this festive season with full vigour.