Union Minister Piyush Goyal on Friday proposed to increase the gratuity limit to Rs 30 lakh.
Thegratuity limit has been increased from Rs 10 lakh to Rs 30 lakh, Mr Goyal said while presenting the interim budget for 2019-20 in Parliament.
The additional Rs 10 lakh in gratuity comes on the back of a raise of the same magnitude in gratuity by the government last year.
Thehike in the gratuity limit will enable employers to pay higher tax free gratuity to their employees who have worked for them for more five yearsThe government had in March last year effected the doublelimit oftax-free gratuityin the private sector.The Payment of Gratuity Act, 1972 is applicable to employees who have completed at least five years of continuous service in an establishment of 10 or more persons.(LIVE Budget Updates)