The Budget 2024 Session is decided to start from July 22 by the Central Government. The next day, on July 23, the country’s annual budget will be presented by Finance Minister Nirmala Sitharaman. The first budget in Modi 3.0 is highly expected by the commoners. Multiple decisions that could provide relief to the middle class are awaited. One among them is the issue of minimum salary. Since a minimum wage hike has been in demand for years, experts have come up with an expectation that employees can expect significant good news on this front after a long wait of ten years. The minimum salary may be hiked from 15,000 to 25,000 rupees.
Contribution To EPF
The Ministry of Labor and Employment has prepared a proposal to increase the minimum salary for contributions to the Employees Provident Fund (EPF) by increasing wages from the current 15,000 rupees to 25,000 rupees in the Budget 2024. The Finance Minister will announce this proposal during the budget session on July 23, fulfilling a long-standing demand.
Interim Budget Hints At Reforms
After presenting the interim budget ahead of the Lok Sabha elections, Finance Minister Nirmala Sitharaman hinted broadly that she was leaving bigger decisions for the next government and emphasized that major decisions cannot be made in an interim budget. The Ministry of Labour and Employment is actively pursuing the change to extend social security coverage to employees. Now, the country’s minimum wages increased after 10 years all because inflation at this time had shown such a steep rise. Before this, the minimum wage was Rs. 6,500 as of September 1, 2014, at the time of revision, but it was later increased to Rs. 15,000.
EPF vs. ESIC Minimum Wage
Central Employees Provident Fund – prevailing minimum salary now – 15,000 rupees. In the ESIC, the minimum wage is 21,000 rupees. The ESIC increased the minimum salary back in 2017. Both the employee and the employer contribute 12% to the basic salary along with dearness allowance to the EPF account. The employee directly transfers the entire contributed amount to the EPF account. Meanwhile, 8.33% of the employer’s contribution goes towards the Employee Pension Scheme, and 3.67% is allocated to the EPF account.
