Congress Introduces Rs 2400 A Year ‘State Income Tax’ In Punjab To Fund Unemployment Allowance

Punjab Legislative Assembly yesterday passed the Punjab Social Security Bill, 2018, and the Punjab State Development Tax Bill, 2018, reported The Tribune. These bills will enable the Congress government in the state to set up a social security fund and introduce new surcharges to fund its welfare schemes.

The Amarinder Singh-led government’s move is aimed at generating a revenue of Rs 1500 crores. It plans to use this fund not only to bring new social welfare schemes but also to give unemployment allowance to the state's jobless youth. The Congress party had promised the dole in its election manifesto.

As a direct consequence of these bills, petrol, diesel, registration of vehicles, electricity and liquor are set to become costlier in the state.

The bills makes provision for surcharges of up to Rs 2 on petrol and diesel, 1 per cent on registration of vehicles, 10 per cent on transport vehicles, 5 per cent on electricity bills and 10 per cent on excise duty.

Finance Minister Manpreet Badal, tabling the bills in the House, claimed that the funds collected will be kept out of the consolidated fund.

“The funds collected will be kept out of the consolidated fund. Around 17.15 lakh beneficiaries under social security pension scheme, 45 lakh getting health insurance and 70 lakh expected to be covered under the Shagun scheme and post-matric scholarship will be disbursed money on time,” Badal added.

The State Development Tax Bill will empower the government to levy a Development Tax of Rs 200 per month on Income Tax payers in the state. This tax will have to be deducted by the employer from employee’s salary. The tax would extend to the whole state, and offices of the government of Punjab, and offices of anybody, which is owned or controlled by the state of Punjab situated in the capital of Punjab, the Indian Express has reported. Punjab currently does not charge ‘Professional Tax’ which is levied by some other states. The bill awaits consent from Governor V P Singh Badnore.