After the Dearness allowance has been hiked for central government employees, the centre has also revised upwards the House Rent Allowance or HRA for central government employees. This shall be paid out to the employees starting August as per the new revised rates.
In the order issued on July 7, 2017 the Department of Expenditure stated that when the house rent allowance shall be hiked beyond 25 percent, House Rent allowance will also be revised. Now as the dearness allowance has been hiked since July 1 to 28 pecent, HRA will also be revised.
New revised HRA or house rent allowance rate
For different categories, HRA has seen an upward revision by as much as 1-3 percent.
For cities categorized as 'X'- HRA will be 27% of the basic pay
'Y' class cities- 18% of the basic pay
'Z' class cities-9% of the basic pay
Currently, it is 24%, 16% and 8% of the listed city categories.
Now X category is the city with where population is more than 50 lakhs
Y city category is assigned to cities where the population is over 5 lakh
Likewise, Z city is the one with population less than 5 lakh
The minimum HRA for all three categories will be Rs 5400, 3600 and Rs 1800.As per the Department of Expenditure, when the dearness allowance scales to 50 percent, the maximum house rent allowance will increase to 30 percent.