Panel backs raising monthly EPFO wage ceiling to ₹21,000 - 24th November 2022

Panel backs raising monthly EPFO wage ceiling to ₹21,000 - 24th November 2022

• Karma
• November 24 09:34:16, 2022

Panel backs raising monthly EPFO wage ceiling to ₹21,000

  Contents News/Article Date:  24th November  2022 Relating to which Act:   The Employees Provident Funds & Miscellaneous Provisions Act, 1952 and the Income Tax Act, 1961 Applicable to which State:  All the establishments in the States with PF and ESI coverage Type: The ET Bureau News Item Pertains to   employers and employees  Relevance of this news: Karma Management Global Consulting Solutions Pvt. Ltd is in the business of Payroll, Outsourcing and Regulatory Compliances from its inception in 2004 and since then, has brought in a lot of efficiencies and technological upgradations with experts on its roll, to ease the hassles of Payroll Processing, Temp Staffing On-boarding, Regulatory and Payroll compliances by providing customized solutions to all its elite clients.   UNDER EPF The contributions are payable on maximum wage ceiling of Rs. 15000/- The employee can pay at a higher rate and in such case employer is not under any obligation to pay at for an International Worker, wage ceiling of 15000/- is not applicable. UNDER EPS Contribution is payable out of the employer’s share of PF and no contribution is payable by employee. In this instance, an expert committee will be set up shortly to determine a higher wage ceiling, which will be indexed to inflation and reviewed periodically for coverage under EPFO, a person aware of the development told ET. According to the person quoted above, the EPFO wage ceiling could even be aligned with the higher Rs.21000 per month wage ceiling under the Employees State Insurance Corporation.   Subject:   Centre likely to raise EPFO wage threshold

For greater details, appended below is the complete news item

 

Panel backs raising monthly EPFO wage ceiling to ₹21,000

 

ET Bureau 

  The Government is likely to soon revise the wage ceiling for the Employees Provident Fund Organisation (EPFO) flagship retirement saving scheme. This will increase the mandatory contribution by both employees and employers, helping workers save more for their retirement.  The increase will also bring more workers under the EPFO’s social security coverage. Currently, the wage ceiling for the EPFO’s Employees Provident Fund (EPF) scheme is Rs. 15,000 per month, which was last revised in 2014 from Rs.6500 per month.  The Scheme is available only to enterprises that have more than 20 workers. An expert committee will be set up shortly to determine a higher wage ceiling, which will be indexed to inflation and reviewed periodically for coverage under EPFO, a person aware of the development told ET. According to the person quoted above, the EPFO wage ceiling could even be aligned with the higher Rs.21000 per month wage ceiling under the Employees State Insurance Corporation. This will bring parity between the two social security schemes run by the labour ministry and ease the compliance burden on establishments. The ceiling serves two purposes: one, organized sector workers earning less than Rs.15000 a month have to compulsorily become members of the EPF. A high-level committee has backed a proposed increase in wage ceiling under the Employees' Provident Fund Organisation (EPFO) to ₹21,000 a month from the current ₹15,000. The committee has, however, said the government can implement the increase from a later date considering all inputs.