EPFO ceiling reset after 12 years; ₹25,000 threshold to cover 5.1 million more workers
Mint 1 hr ago·16 Sept 2026, 1:01 pm
The Employees' Provident Fund Organisation (EPFO) has raised the salary ceiling for mandatory contributions for the first time in 12 years. This change increases the limit to ₹25,000 per month from ₹15,000, meaning higher-paid employees will now have to contribute a larger share of their income. The move is expected to bring an additional 5.1 million workers into the formal social security net.
This policy shift is significant for the broader economy as it formalizes a larger segment of the workforce. For the market, it represents a structural increase in the long-term savings base, which could support the equity market over the long term. However, it also implies higher operational costs for employers and potentially lower take-home pay for some salaried individuals.
Investors should watch how this impacts corporate hiring costs and employee retention strategies. While the immediate effect on individual stocks may vary, the move signals a government push toward financial inclusion and a larger tax base.
Excerpt from Mint
The first revision in 12 years expands mandatory social-security coverage, but will raise contribution costs for employers and affected employees. NEW DELHI: The Centre is expanding mandatory retirement and social-security coverage to more formal-sector workers, raising the wage ceiling for compulsory Employees’…Read the original at Mint
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