Karnataka proposes 5% cess for gig workers

Karnataka’s labour minister, proposed a cess of 5% on newly registered vehicles to support the gig workers.

Santosh Lad, Karnataka’s labour minister, proposed a cess of 5% on newly registered vehicles to support the gig workers. App-based companies like Uber, Ola, Swiggy, and Zomato and the transport sector, including drivers, conductors, cleaners, and mechanics, are referenced when talking about gig workers. As the term denotes, gig workers don’t obtain the employment benefits that regular employees receive from employers. Gig workers might have contracts specifying the terms and conditions as regular employees. Still, their contracts don’t mention any social benefits of education, health and insurance, which employers are liable to give. Lately, many experts have raised this issue and brought the government’s attention to interfering in providing essential assistance that a resident should receive, which also aids them in transitioning to the formal economy. 

This cess is estimated to support the welfare of more than 45 lakh informal and gig workers in the state. The Karnataka government levies one of the highest road taxes coming to 11% in the country. Out of this 11%, 10% is imposed as infrastructure cess, 1% as urban transport cess and 5% cess if they decide to implement it. Similarly, the Rajasthan government recently approved a bill to impose a surcharge on online transactions via platforms like Amazon, Ola and Zamato to fund the welfare of gig workers. While support like this is of utmost importance for gig workers, the initiative remains silent on the implementation challenges and its sufficiency in covering the essentials.

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