Govt plans per-transaction cess for gig workers' welfare

 Bengaluru: Authorities have found a way out to levy a cess that will fund the welfare of gig workers, for which a Bill — under discussion for several months — is likely to be introduced in the winter session of the legislature later this year. 

The cess, whose quantum is not yet known, will be levied on every transaction that happens on aggregator platforms. 

There was ambiguity in the draft Karnataka Platform-based Gig Workers (Social Security and Welfare) Bill on whether the cess will be levied per transaction or on the state-specific turnover of an aggregator.  

“The department had 20-25 rounds of discussions with all stakeholders. They preferred a per transaction-basis cess since they (aggregators) usually don’t disclose their total turnover. It is also better since it is assured,” Principal Secretary (Labour) Mohammed Mohsin told DH.  

The Bill proposes to establish a Karnataka Gig Worker’s Social Security and Welfare Fund, which will include money from the cess, grants by the government and contributions by individual platform-based gig workers.

The welfare of gig workers was a poll promise in the Congress’ 2023 manifesto. Congress had promised a Karnataka Platform-based Gig Workers’ Welfare Board with Rs 3,000-crore seed money as a revolving fund.

The Bill is crucial in the backdrop of the gig economy’s massive growth. According to a 2022 Niti Aayog report, the gig workforce is expected to expand to 2.35 crore by 2029-30. 

Babu Mathew from the Centre for Labour Studies at the National Law School of India University (NLSIU) quoted the Centre’s Social Security Code, 2020, that contribution by an aggregator shall not exceed 5% of the amount paid or payable to gig workers and platform workers.

Fund facts

* Fund will include money from cess, govt grants, contributions by platform-based gig workers

* Welfare of gig workers was Congress' poll promise

* Bill is crucial in the backdrop of the gig economy's massive growth

* Gig workforce is expected to expand to 2.35 crore workers by 2029-30