A sunset through a construction building near Cantonment railway station in Bengaluru on Monday.
DH Photo/B K Janardhan
Bengaluru: Karnataka will go after private buildings constructed since 2007 that did not pay a mandatory cess, and the recovery of arrears may fetch a whopping Rs 15,000-Rs 20,000 crore, Labour Minister Santhosh Lad said on Thursday.
Since 2007, a 1% cess is being levied on building constructions costing Rs 10 lakh and above, employing 10 or more workers. This applies to individual homes, too.
The cess money is used by the Karnataka State Building and Other Construction Workers Welfare Board for welfare schemes for construction workers.
In an interview to DH, Lad conceded that cess collection is diligent in government constructions, but lax in the private sector.
"An audit of all buildings built from 2007 to 2024 will be done on a public-private partnership (PPP) model. We will verify the buildings' value and the money paid by these companies (builders). This way, we expect to generate at least Rs 15,000-Rs 20,000 crore," Lad said.
If the government's estimate holds, it will massively boost the Board's finances. So far, the Board has collected Rs 11,770 crore in cess, of which Rs 5,272 crore has been spent on welfare programmes.
"The cess is usually paid on the basic construction cost," Lad explained. "However, there are several things like tiles, granite, sofa, painting and so on that also involve construction labourers. Such works also need to be accounted for."
While audit aims to rectify past discrepancies, the department has other ideas to better control the process in the future. Authorities are on the verge of calling a tender to create a software to make different departments align with the Board.
"Through this, we will get first-hand information from gram, taluk and zilla panchayats, including municipal corporations and district administrations, to control the cess collection process better," Lad said.
In December last year, Lad held a meeting with officials to explore the use of Geographical Information System (GIS) to increase cess receipts. The plan was to map construction activity via GIS to ensure cess payments.
There are a total of 51.92 lakh registered construction workers holding a 'labour card' of whom 27.7 lakh are active. The Board is dealing with allegations that there are lakhs of bogus 'labour cards', raising concerns that ineligible persons are availing benefits meant for construction workers.
Key points:
- 1% cess applies to individual homes, too
- Department plans to better control process in future
- To call tender for software to make depts align with Board
- This will help gather first-hand info from various bodies