Centre announces 3% DA increase for employees, new rates effective July 2025

New Delhi, Oct 06: The Ministry of Finance has ordered a revision in Dearness Allowance for Central Government employees, enhancing the rate from 55 percent to 58 percent of basic pay with effect from July 1, 2025.

The Department of Expenditure, in an official memorandum issued by ministry of finance as per news agency Kashmir News Corner --- KNC, said that the President has approved the increase under the recommendations of the 7th Central Pay Commission.

It specified that the DA will be calculated only on the “Basic Pay” drawn in the pay matrix and will not include any form of special pay or additional components.

The order notes that DA will remain a distinct part of the salary structure and will not be considered as pay under Fundamental Rule 9(21). Amounts of 50 paise and above will be rounded off to the nearest rupee, while smaller fractions will be ignored.

The hike will also cover civilian employees paid through Defence Services Estimates, while separate notifications will follow for personnel in the Armed Forces and Railways.

The Finance Ministry also mentioned that for those serving in the Indian Audit and Accounts Department, the decision was taken in consultation with the Comptroller and Auditor General of India, as mandated by the Constitution.