At the same time, the government emphasised that there will be no review of reservation.
Union Finance Minister Arun Jaitley announced that OBC families earning up to Rs 8 lakh per annum will not be considered in the creamy layer. Earlier, this ceiling was Rs 6 lakh per annum.
"The proposal is that there will be sub-categorisation within the OBC list for the purposes of central government employment. In this connection, the National Commission for Backward Classes had given its recommendation in 2011," Mr Jaitley said while briefing the media after a Cabinet meeting.
He said the Parliamentary Standing Committee gave the same recommendation in in 2012-13. "After inter-ministerial consultations, it was accepted," he said.
He said the commission will examine "the extent of inequitable distribution of benefits of reservation among caste or communities included in the broad category of OBCs with reference to the central list".
"With this, those in the broad category of OBCs who were till now devoid of benefits of reservation, will get the benefits. There will be more equitable distribution," he said.
On whether the government is going to review the reservation mechanism, Mr Jaitley said: "There is no such proposal... there will be no review."