<p>The 8th Pay Commission might kick in from January 2026, boosting the salaries of government employees and pensioners by 20-25%. However, this huge salary hike could put an extra financial burden of about Rs 3.9 lakh crore annually on Centre.</p><img><p>Millions of government employees are awaiting the 8th Pay Commission. The report is expected in 18 months, with a new pay system likely from Jan 2026, but it will cost a lot.</p><img><p>The good news: a 20-25% hike in basic pay and pension is expected with the 8th Pay Commission. This will directly benefit about 25 million people, boosting their spending power.</p><img><p>The government is worried about the cost. Implementing the pay commission will add an annual burden of ₹1.4 lakh crore for the center and ₹2.5 lakh crore for states, totaling ₹3.9 lakh crore.</p><img><p>When government spending increases, it affects the whole economy. The central government’s deficit might rise to 5% of GDP, and states will have less money for development.</p><img><p>The 8th Pay Commission isn’t just about salaries; it’s about the economy. The government will have less ‘fiscal space,’ or freedom to spend, possibly leading to tax hikes or more debt.</p>
