Parliament approved The Payment of Gratuity (Amendment) Bill on Thursday with Rajya Sabha giving its nod for the legislation, enabling the government to double the tax-free gratuity limit from Rs10 lakh to Rs 20 lakh for the central government employees.

Further, this will allow the government to increase the gratuity ceiling from time to time without amending the law.&nbsp;

The Lok Sabha has already passed the Bill on March 15.

The bill also notifies the period of maternity leave as part of continuous service and proposes to empower the central government to notify the gratuity ceiling from time to time without amending the law.

The Payment of Gratuity Act, 1972, was enacted to provide for gratuity payment to employees engaged in factories, mines, oilfields, plantations, ports, railway companies, shops or other establishments.

It is applicable to employees, who have completed at least five years of continuous service in an establishment that has 10 or more persons.&nbsp;

(With inputs from Agencies)

The Bill got Parliament's approval after it was passed by the Rajya Sabha through a voice vote.

Parliament approved The Payment of Gratuity (Amendment) Bill on Thursday with Rajya Sabha giving its nod for the legislation, enabling the government to double the tax-free gratuity limit from Rs10 lakh to Rs 20 lakh for the central government employees. Further, this will allow the government to increase the gratuity ceiling from time to time without amending the law. The Lok Sabha has already passed the Bill on March 15. The bill also notifies the period of maternity leave as part of continuous service and proposes to empower the central government to notify the gratuity ceiling from time to time without amending the law. The Payment of Gratuity Act, 1972, was enacted to provide for gratuity payment to employees engaged in factories, mines, oilfields, plantations, ports, railway companies, shops or other establishments. It is applicable to employees, who have completed at least five years of continuous service in an establishment that has 10 or more persons. (With inputs from Agencies)

Parliament passes bill to double tax-free gratuity to Rs 20 lakh

By:&nbsp;Prakash Priyadarshi

Payment of Gratuity (Amendment) Bill, 2017, which will make formal sector workers eligible for tax-free gratuity up to Rs 20 lakh, is likely to be introduced in the forthcoming budget session.&nbsp;

At present formal sector workers with five or more years of service are eligible for Rs 10 lakh tax-free gratuity after leaving the job or at time of superannuation.&nbsp;

According to a labour ministry source, the government wants to increase the limit of tax-free gratuity from Rs 10 lakh to Rs 20 lakh for workers in the organised sector.

Sources said that once the bill is passed by the Parliament, the government can increase the quantum of tax-free gratuity through a notification.&nbsp;

The bill was introduced in the Lok Sabha by labour minister Santosh Kumar Gangwar during the winter session of Parliament in December 2017.&nbsp;

What is Payment of Gratuity Act

The Payment of Gratuity Act 1972 provides for the payment of gratuity to employees engaged in industries including mines, oilfields, plantations, shops, factories, amongst others. The tax-free gratuity limit was raised to Rs 10 lakh through the Payment of Gratuity (Amendment) Bill, 2010.&nbsp;

The law is applicable to employees, who have completed at least five years of continuous service in an establishment that has ten or more employees.

The bill was introduced in the Lok Sabha by labour minister Santosh Kumar Gangwar during the winter session of Parliament in December 2017

By: Prakash Priyadarshi Payment of Gratuity (Amendment) Bill, 2017, which will make formal sector workers eligible for tax-free gratuity up to Rs 20 lakh, is likely to be introduced in the forthcoming budget session. At present formal sector workers with five or more years of service are eligible for Rs 10 lakh tax-free gratuity after leaving the job or at time of superannuation. According to a labour ministry source, the government wants to increase the limit of tax-free gratuity from Rs 10 lakh to Rs 20 lakh for workers in the organised sector. Sources said that once the bill is passed by the Parliament, the government can increase the quantum of tax-free gratuity through a notification. The bill was introduced in the Lok Sabha by labour minister Santosh Kumar Gangwar during the winter session of Parliament in December 2017. What is Payment of Gratuity Act The Payment of Gratuity Act 1972 provides for the payment of gratuity to employees engaged in industries including mines, oilfields, plantations, shops, factories, amongst others. The tax-free gratuity limit was raised to Rs 10 lakh through the Payment of Gratuity (Amendment) Bill, 2010. The law is applicable to employees, who have completed at least five years of continuous service in an establishment that has ten or more employees.

Tax-free gratuity limit set to go up to Rs 20 lakh: Labour Ministry Sources

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