Cabinet Approves Extension Of EPF Contributions By Government Till August 2020
The government will continue to bear cost of employees’ provident fund contribution for three more months until August 2020, Union Minister Prakash Javadekar said on Wednesday. Finance Minister Nirmala Sitharaman had announced the extension of the benefit in May this year.
"The Union Cabinet has approved the extension of the scheme where government pays contributions of employee and employers till August," Javadekar said while announcing the cabinet decisions that were taken at a meeting today.
Sitharaman had in May announced the extension of the scheme under the Pradhan Mantri Garib Kalyan Yojana, where the government would contribute the full 24% of EPF contributions till August, giving relief to 3.67 lakh employers and 72.22 lakh employees.
Javadekar said that the decision has been taken to facilitate more take-home salary for employees and give relief to employers in payment of EPF dues.
Under the Pradhan Mantri Garib Kalyan package, the payment of 12% of employer and 12% employee contribution was made into EPF accounts. The benefit was provided earlier for salary months of March, April and May 2020. This support is extended by another three months to salary months of June, July and August 2020.
The extension of the benefit will provide a liquidity relief to 3.67 lakh establishments. The government is of the view that businesses need support to ramp up production over the next quarter—i.e. the July-September period.