7th CPC: HRA will be @ 24%, 16% & 8% wef 1.7.2017

House Rent Allowance

house rent allowance

Cabinet approved HRA @ 24%, 16% & 8% from 1.7.2017 for X, Y & Z categary of cities. It will further revised upward @ 27%, 18% & 9% when DA reaches 25% and @ 30%, 20% & 10% when DA reaches 50%. HRA shall not be less than Rs.5400, Rs.3600 & Rs.1800 for X, Y & Z categary of cities.

HRA is currently paid @ 30% for X (population of 50 lakh & above), 20%
for Y (5 to 50 lakh) and 10% for Z (below 5 lakh) category of cities. 7th
CPC has recommended reduction in the existing rates to 24% for X, 16% for Y
and 8% for Z category of cities. As the HRA at the reduced rates may not be
sufficient for employees falling in lower pay bracket, it has been decided
that HRA shall not be less than Rs.5400, Rs.3600 and Rs.1800 for X, Y and Z
category of cities respectively. This floor rate has been calculated @ 30%,
20% and 10% of the minimum pay of Rs.18000.

This will benefit more than 7.5 lakh employees belonging to Levels 1 to
7th CPC had also recommended that HRA rates will be revised upwards in two
phases to 27%, 18% and 9% when DA crosses 50% and to 30%, 20% and 10% when
DA crosses 100%. Keeping in view the current inflation trends, the
Government has decided that these rates will be revised upwards when DA
crosses 25% and 50% respectively. This will benefit all employees who do
not reside in government accommodation and get HRA.
Source: PIB
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