Govt. is considering to withheld 50% of 7th CPC hike

The government is considering an innovative proposal under which 50% of increased salary of higher-income government staff under the Seventh Pay Commission will be compulsorily invested in bank capitalisation bonds. The proceeds will be used to recapitalise banks without additional pressure on the fisc. While this will result in less cash in the hands of higher-income employees, as a sweetener they will get income tax rebate on the amount invested.