<h1>Union Cabinet Boosts NPS Benefits: Higher Govt Contribution, Tax-Free Withdrawals, and More Flexibility for Employees.</h1> The Union Cabinet approved enhancements to the National Pension System (NPS) for central government employees. Key changes include increasing the government's contribution from 10% to 14% under NPS Tier-I, offering employees the freedom to select pension funds and investment patterns, and providing compensation for delayed contributions from 2004-2012. The tax exemption limit for lump-sum withdrawals at retirement is increased to 60%, making the entire withdrawal tax-free. Contributions under NPS Tier-II now qualify for tax deductions up to Rs. 1.50 lakh with a three-year lock-in period. These changes aim to increase retirement benefits for approximately 18 lakh employees, with an estimated cost of Rs. 2840 crores for 2019-20.