The state cabinet on Wednesday cleared a proposal to charge one per cent cess on all private construction in the state.
The state will stringently implement the tax to fund welfare schemes for more than 20 lakh construction labourers. On Wednesday, the cabinet directed all departments in charge of granting building permissions to collect the cess at the time of giving commencement certificates. The cess, charged on all developers of buildings and infrastructure projects will ultimately pinch your pocket, but only nominally, said officials. Hindustan Times first reported this proposal in January.
Agencies like the Brihanmumbai Municipal Corporation and the Maharashtra Housing and Area Development Authority will be asked to collect the cess. Commencement certificates for construction will now have a unique identification number linked to payment of the cess.
The cess is meant to go to a Welfare Board, which will work out schemes such as health insurance, training, crèches for construction workers and scholarships for their children. The cess is expected to bring in crores of rupees annually, said Kavita Gupta, labour secretary.
The builders’ lobby is expected to oppose the proposal. “The intention is good but from experience we feel the money will not go to the intended beneficiaries,” said a prominent developer on condition of anonymity.