Will new wage changes also affect the taxes paid by employees?

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Hi,

A recent employee question on Wage code, Will new wage changes also affect the taxes paid by employees in any ways? What changes need to be made to their existing tax saving allocation?

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Hi Chitra,

When the new wage changes are implemented, Basic allocation will increase to 50% and automatically statutory contributions like PF, Gratuity will increase. Since PF is part of section 80C it will cover most of the 1.5L limit if the contribution is not restricted to 1800.

Employees may have to plan their allocation based on this.

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