Central Cabinet Approves 3% DA Increase, Adding Joy to Diwali Celebrations

Central Cabinet Approves 3% DA Increase, Adding Joy to Diwali Celebrations

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The Modi government has announced a significant benefit for millions of employees nationwide just before Diwali. On Wednesday, the Central Cabinet, led by Prime Minister Narendra Modi, approved the release of the Dearness Allowance (DA). While this decision primarily affects central government employees, all states are expected to implement a DA increase once they receive approval from the central government.

Typically, the Central Government adjusts the Dearness Allowance (DA) for employees every January and July. In January 2024, the DA was raised by 4%, and in the recent meeting, a decision was made to increase it for July as well. As a result, there will be a 3% increase in DA effective from July, and employees will also receive back pay for July, August, and September.

How Much Will Your Salary Increase?

The Dearness Allowance (DA) is calculated based on an employee’s basic salary. For instance, if an employee’s basic salary is ₹40,000 and the DA rises by 3%, their salary will go up by ₹1,200.

To illustrate, if an employee’s total salary was ₹60,000 (including basic salary, DA, and HRA), it will now be ₹61,200.

How Much Arrears Will You Receive?

With the 3% DA increase, an employee earning a basic salary of ₹40,000 will see an additional ₹1,200 in their monthly Dearness Allowance. Since this increase takes effect in July, employees will also receive arrears for the months of July, August, and September.

October Salary Increase: How Much Will You Receive?

With the DA increase effective from July, employees will get the higher amount for four months: July, August, September, and October.

  • Calculation of Salary Increase:
  • – Basic Salary: ₹40,000
  • – Monthly DA Increase: ₹1,200
  • – Total Increase for 4 months: ₹1,200 multiplied by 4 equals ₹4,800

If an employee’s current total salary is ₹60,000, their new total salary in October will be:

  • – Current Total Salary: ₹60,000
  • – Additional DA for 4 months: ₹4,800
  • – New Total Salary: ₹60,000 plus ₹4,800 equals ₹64,800

Therefore, employees with a basic salary of ₹40,000 can expect an increase of ₹4,800 in their October salary, bringing it to ₹64,800.

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