Employers must pay for it, not consumers

The Karnataka government proposes to levy a 5 per cent surcharge on registration of new vehicles to support the welfare of informal and gig workers, according to Labour Minister Santosh Lad. Gig workers are those engaged in part-time jobs, such as delivery partners and drivers of app-based services. This social security measure, which will benefit lakhs of workers is welcome. But it is not prudent to raise funds for this through an additional surcharge on vehicle registration. A question arises on the responsibility of the companies and aggregators toward the informal or gig workers they employ and profit from. At present, Karnataka levies one of the highest road taxes in the country, ranging from 13 per cent to 20 per cent. The state also imposes a 10 per cent infrastructure cess and a 1 per cent urban transport cess. This new surcharge may force buyers to purchase vehicles from neighbouring states, where the taxes are lower, thereby impacting Karnataka’s revenues. As things stand, Karnataka no longer imposes fines on vehicles registered in other states as a case in this regard is pending before the High Court. Recently, the High Court also struck down the government’s notification that excluded private sector employees from registering their vehicles under the BH series. One of the features of the BH scheme is that those with transferable jobs need not apply for registration every time they are posted in a new state. Thus, the government may have to find new ways of earning revenues, rather than imposing another cess on vehicles.

In his budget, Chief Minister Siddaramaiah had announced a Rs 4-lakh insurance scheme for the benefit of gig workers, and it was to be entirely funded by the state government. There is also a proposal to tax online transactions on platforms like Amazon, Flipkart, Zomato and Swiggy. The government also proposes to impose a 1 per cent cess on movie tickets to support those working in the cinema industry. While the government’s intent to give a measure of social security to gig workers is to be appreciated, the government should ask primarily not the consumer to bear the burden but the businesses and companies that employ them and who benefit the most from the risks that the poorly paid gig workers take.

Santosh Lad should ensure that existing labour laws, which provide for certain security and welfare measures for workers, are made applicable to all employers without distinction. This is all the more important in the case of delivery agents whose lives are exposed to high risks. Companies have a higher responsibility toward their workers than consumers. They cannot be allowed to escape that responsibility on the ground that they are not regular employees.