On Wednesday, in view of the Corona virus crisis, the government has made big relief announcements regarding the Employees Provident Fund. For the next three months, the government has reduced the EPF contribution of both employees and employers from 12 percent to 10 percent. This announcement of the government will provide relief not only to the employees and employers but also to the EPFO. However, during this time the contribution of the employer in the CPSEs and PSUs of the states will remain 12 percent.
In his address, the Finance Minister said on Wednesday that the benefit of reduction in PF contribution will also be available to those employees who are not eligible to avail benefits under the Prime Minister's Poor Welfare Package under 24 percent EPF support and its extension. 4.3 crore employees and 6.5 lakh institutions will benefit from the reduction in PF contribution. With this step, employees and employers will be able to get liquidity of Rs 6750 crore in three months.
With this step of the government, now the employees will get increased salary for the next three months. The government has reduced the employee's contribution from 12 percent (basic + DA) to 10 percent. With this, now two percent of basic + DA amount will be more in the hands of employees. Employers will have to contribute two percent less EPF contribution of basic + DA, this will also cost them less in EPF contribution.
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