As per the circular issued by the Finance Department on Thursday, September 25, 2026, the Government of Sikkim has hiked the DA for its employees and DR for pensioners. The revised rates will be applicable w.e.f. January 1, 2026.
About 50,000 employees and pensioners on the rolls of the state are expected to benefit from the revision.
According to the new order, those employees and retirees who draw salary/pension as per the previous revision pay structure would now get an increase of their DA/DR rates from 257 percent to 262 percent.
For officers of All India Services (AIS) working in the state as per the revised pay structure based on the Seventh Pay Commission, there has been an increase in the DA rate from 58 percent to 60 percent.
Since the revised rates have been implemented retrospectively from the beginning of the year, it can be assumed that both employees and pensioners will get arrears covering the time starting from January till the time when the revised DA is received in their salary/pension.
This comes in line with the previous announcement made by Chief Minister of Sikkim Prem Singh Tamang back in August, where he had mentioned that the revised 2 per cent DA and DR for the period of January to June 2026 will be paid along with arrears prior to Dashain, an autumn festival celebrated in the region.
Thursday's DA revision is part of the usual trend of DA revisions made by the Sikkim government. The state increased DA and DR from 252 to 257 per cent w.e.f. July 1, 2025, which constitutes a 5 per cent increment also applicable to contractual employees and AIS officers. Previously, the DA and DR were revised from 239 to 246 per cent w.e.f. July 1, 2024, and from 38 to 42 per cent as early as September 2023, among other periodic revisions.
The Chief Minister of Sikkim, Shri P.S. Tamang has stated that Sikkim has always been following the DA and DR revisions of the Centre and that the state has been following the decisions made by the Government of India in terms of allowances.
What makes the recent report unique is that central government employees themselves have not yet got the next DA revision in the works despite the ongoing efforts for the 8th Pay Commission.
The calculation of the estimated DA increase for central government employees based on the 12-month CPI-IW average for the period of July 2025-June 2026 at 148.65 suggests a hike of 63.76 per cent, which is expected to round off to 63 per cent – an increase of 3 per cent compared to the existing 60 per cent.
Until such a central revision becomes effective, the allowance scale of Sikkim with its distinct pre-revised and revised pay band will remain separate.
The newly introduced rates go far beyond the usual state employees. The contractual workers as well as those working in the work-charged establishments can also enjoy these rates, on condition that their salaries are in line with the usual state government pay structure.
The All India Service officers who are serving in the state of Sikkim have also been included in these revised rates.
The former gets the same increase like the other state employees, while the latter enjoys the DA rate revised as per the new 60 per cent rate.
The purpose of Dearness Allowance is to compensate for the impact of inflation on the purchasing power of the salaries and pensions of government employees.
The Finance Department of the state of Sikkim has explained its continuous revision of the allowance as their continuous attempt to keep the income level of their employees at par with economic changes.
Since the new rates take effect on January 1, 2026, it is anticipated that the Government of Sikkim will calculate the revised DA and DR in future salary and pension payouts along with the corresponding arrears for the months past this year.
In line with the trend set by the state government thus far, the next revision may be implemented when the additional cost of living data becomes available, especially in case the long awaited DA hike by the central government is approved soon.
