Decks cleared for tax-free gratuity of up to Rs 20 lakh

Tribune News Service

New Delhi, March 22

Parliament on Thursday cleared the Payment of Gratuity (Amendment) Bill, enhancing the limits of the welfare measure following appeal by Chairman M  Venkaiah Naidu for its passage. 

The Rajya Sabha, which witnessed disruption for the past fortnight, passed without discussion the Bill cleared by the Lok Sabha earlier.

The Bill paves the way for doubling the limit of tax-free gratuity to Rs 20 lakh.

The Bill was necessitated to tide over the anomalies surfacing in the implementation of existing Payment of Gratuity Act in the light of recommendations of the 7th Central Pay Commission.

The measure aims to put on a par employees of private and public sector undertakings and autonomous organisations under the government who are not covered under the Central Civil Services (Pension) Rules.

Besides enabling the Centre to fix the ceiling of tax-free gratuity, the Bill also empowers it to fix the period of maternity leave through an executive order. It also notifies the period of maternity leave as part of continuous service and proposes to empower the Centre to notify the gratuity ceiling from time to time without amending the law.