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The Karnataka authorities is planning to impose further cess on each transaction on aggregators platforms like Zomato, Dunzo, Swiggy, Zepto, Ola and others. Karnataka Labour Minister Santosh Lad mentioned the funds collected will likely be allotted to the Welfare Fund for Gig employees.
Karnataka Labour Minister Santosh mentioned: “The Labour division of Karnataka has determined to impose cess on each transaction on aggregators platforms like Zomato, Dunzo, Swiggy, Zepto, Ola and others such. The Cash which will likely be collected will likely be used for the Welfare fund for Gig employees. We’re not charging for merchandise or items which shoppers buy, wit will likely be charged solely on transport.”
The state authorities’s draft notification for the Platform-based Gig Staff (Social Safety and Welfare) Invoice, 2024 contains the implementation of a payment. This payment, known as the “Platform-based Gig Staff Welfare Payment”, will likely be levied on aggregators with a view to set up “The Karnataka Gig Staff Social Safety and Welfare Fund”.
The invoice will embody aggregators providing a spread of companies together with ride-sharing, meals and grocery supply, logistics, e-marketplaces, skilled companies, healthcare, journey and hospitality, content material, media companies, and extra. In response to the draft Invoice, aggregators are required to submit the welfare payment to the state authorities on the finish of every quarter.
As soon as the invoice is authorised, the platforms will accumulate the payment and switch it on to the welfare board. Though the businesses won’t revenue from this variation, clients could also be discouraged from putting frequent orders as a result of a small improve in prices starting from 1-2%.
Earlier, NASSCOM had raised considerations about sure provisions within the gig employees’ invoice, noting that they may have a adverse affect on aggregator companies. IAMAI additionally expressed their reservations relating to the draft legislation, citing potential obstacles to enterprise operations and the state’s ease of doing enterprise rating. Contrarily, IFAT and Vidhi Centre for Authorized Coverage, together with different Unions, welcomed the invoice.
The labour division clarified that there could be no double taxation for gig employees. Aggregators had objected to the division’s resolution, arguing that gig employees are already coated beneath the Union authorities’s Code on Social Safety, which features a social safety fund funded by aggregator contributions starting from 1% to 2% of annual turnover, with a cap at 5% of funds to employees. Regardless of this, the Karnataka labour division maintained that there could be no duplication of taxes.
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