Budget 2022 NPS Pension News: Deduction, contribution, income tax limit and more - What state government employees should know

Budget 2022 NPS Deduction, Contribution, Tax News: Finance Minister Nirmala Sitharaman while presenting the Union Budget 2022-23 in Parliament on Tuesday had proposed to increase the tax deduction limit from 10 per cent to 14 per cent in employer's contribution to the NPS account of the state government employees as well.

NPS: Central Government Employees  - Present status?

- At present, the central government contributes 14 per cent of the salary to the National Pension System (NPS), which is allowed as a tax deduction in the income of an employee.

NPS: State Government Employees - Present status?

- For the state government, the tax-free contribution by the employer is 10 per cent.

Budget 2022: What Finance Minister Nirmala Sitharaman said?

- FM Sitharaman said the move will provide equal treatment to both central and state government employees.

- This would help in enhancing the social security benefits of the state government employees and bring them at par with central government employees, the FM said.

What Pension Fund Regulatory and Development Authority Chairman said?

- PFRDA Chairman Supratim Bandyopadhyay has said that state government employees will get an enhanced social security cover and will be treated at par with central government staff, as the centre has proposed hike of tax deduction limit to 14 per cent for state government employees under the National Pension System (NPS).

- "This is a significant announcement to bring state government employees on par with the central government employees and this will help state government employees getting extended social security benefits in line with their counterparts in the union government," Pension Fund Regulatory and Development Authority (PFRDA) Chairperson Bandyopadhyay said.