Archive · 18 Jul 2026
Government Announces Dearness Allowance Hikes for Employees
The government has increased the Dearness Allowance (DA) for central government employees and pensioners to 60% of their basic salary.
This hike helps them deal with rising living costs.
The DA is updated twice a year based on the All-India Consumer Price Index (AICPI).
Many states like West Bengal, Assam, and Tamil Nadu have also announced their own DA hikes.
Employee unions are asking the government to merge DA with basic salary, but the government has not agreed yet.
The next DA hike is expected in July 2026.
The central government increased DA from 58% to 60% of basic salary, effective from 1 January 2026.
Several states, including West Bengal, Assam, and Tamil Nadu, have also announced DA hikes.
The Indian Banks' Association revised DA for bank employees, increasing basic salaries and DA.
Employee unions are demanding the merger of DA with basic salary, but the government has not agreed.
The next DA hike is expected to be announced in July 2026.
- Who
- Central government employees and pensioners, including defence personnel and retirees
- What
- Increase in Dearness Allowance (DA) and Dearness Relief (DR)
- When
- Effective from 1 January 2026, with announcements in April and May 2026
- Where
- India, with specific state-level announcements
- Why
- To mitigate the impact of rising living costs and inflationary pressures
Employee Unions
Government
DA Merger
Employee Unions
Employee unions are demanding the merger of DA with basic salary as it now exceeds 50% of basic pay.
Government
The government has clarified that no proposal for DA merger is currently under consideration.
- Current DA for Central Government Employees
- 60% of basic salary
- Number of Beneficiaries
- 50 lakh employees and 65 lakh pensioners
- Next Expected Hike
- July 2026
- DA Calculation Formula
- Based on AICPI's 12-month average
- DA Types
- Industrial DA and Variable DA
- Taxability of DA
- Subject to income tax
- Recent State Hikes
- West Bengal (38%), Assam (60%), Arunachal Pradesh (60%), Tamil Nadu (60%), Bihar (262% for 6th CPC, 483% for 5th CPC, 60% for 7th CPC), Odisha (60%), Uttar Pradesh (60%), Maharashtra (₹ 800 crore arrears)