Lok Sabha Question No. 2228 (UNSTARRED), answered on 2017-07-28
Subject: Cess for Welfare Activities
Ministry: FINANCE
Asked by: PANKAJ CHOWDHARY

- (a)    Yes, Madam.
- (b)    The  list  of  cesses  levied  by  the  Central  Government  in  2015-16  and  2016-17  is  at Annexure-I.

The list  of  Cesses  abolished  by  the  Central  Government through Taxation Laws Amendment Act 2017 is given at Annexure - II.

Under the GST regime, no cess is levied by the Centre for welfare activities as such. However, a Goods and Services Tax Compensation Cess has been levied under the Goods and Services Tax (Compensation to States) Act, 2017 so as to provide for compensation to the States for the loss  of  revenue  arising  on  account  of  implementation  of  the  goods  and  services  tax  in pursuance of the provisions of the Constitution (One Hundred and First Amendment) Act, 2016.

## Government of India Ministry of Finance Department of Revenue

## LOK SABHA

## UNSTARRED QUESTION NO. 2228

TO BE ANSWERED ON FRIDAY, JULY 28, 2017 SHRAVANA 6, 1939 (SAKA)

## 'CESS FOR WELFARE ACTIVITIES'

## 2228: SHRI PANKAJ CHAUDHARY:

Will the Minister of Finance be pleased to state:

- (a) whether any cess is levied by the Centre and States/Union Territories for welfare activities;
- (b) if so, the details of such cess levied, item wise;
- (c) the criteria being followed for maintaining the accounts of the amount levied and spent for welfare activities;
- (d) whether Apex Court has expressed its displeasure over the non-submission of details of the funds  amounting  to  rupees  twenty  thousand  crores  to  be  spent  on  welfare  of  construction workers, if so, the details thereof; and
- (e) whether the Government has put in place any policy/monitoring mechanism to ensure proper maintenance of accounts of the funds accrued through cesses and their utilisation for welfare activities, if so, the details thereof?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF FINANCE

## (SANTOSH KUMAR GANGWAR)

(c) Cesses collected by the Union Government are credited to Consolidated Fund of India in terms to Article 266(1) of Constitution of India and utilization there from regulated in terms of Article 144 of the Constitution of India.

## (d) Cess  levied  under  Building  and  Other  Construction  workers'  Welfare  Cell  Act, 1996:

The  Government  has  enacted  the  Building  and  Other  Construction  Workers  (Regulation  of Employment  and  Conditions  of  Service)  Act,  1996  and  the  Building  and  other  Construction Workers'  Welfare  Cess  Act,  1996  to  regulate  the  employment  and  conditions  of  service  of building  and  other  construction  workers  and  to  provide  for  their  safety,  health  and  welfare measures.

For the purposes of the above said Act, a cess is levied and collected at the rate of 1% of the cost of construction by the State Governments under the Building and Other Construction Workers' Welfare Cess Act, 1996.

The  States,  through  their  respective  State  Building  and  Other  Construction  Workers  Welfare Boards, constituted under BOCW Act, utilize the cess fund in terms of Section 22 of BOCW Act, 1996.

As  on  30.06.2017  (Provisional),  States  and  Union  Territories  have  collected  total  amount  of Rs. 33602.61 Crore and have spent an amount Rs. 7601.38 Crore.

The  Hon'ble  Supreme  Court  is  monitoring  the  status  of  implementation  of  the  Building  and Other  Construction  Workers  (RECS)  Act,  1996  and  the  Building  and  Other  Construction Workers  Welfare  Cess  Act,  1996  in  Writ  petition  No.  318  of  2006  filed  by  M/s  National Campaign Committee for Central Legislation on Construction Labour.

The Member Secretary, NALSA (National Legal Service Authority) has been impleaded by the Hon'ble Court to assist the Hon'ble Court in respect of the compliance of the directions of the Hon'ble  Court  dated  16.10.2015.    The  Hon'ble  Court  in  its  last  hearing  on  8 th May,  2017, directed the States/UTs to submit details in regard to amount of cess collected and transferred to  the  State  Building  and  Other  Construction  Workers  Welfare  Board  to  the  CAG  and  then requested CAG to file the details.

(e) The Central Government has constituted a Monitoring Committee on 09.09.2015 under the Chairmanship of Secretary (Labour and Employment) to monitor the implementation of the welfare  provisions  of  the  Act  and  utilization  of  Cess  fund  for  the  purpose.  The  Monitoring Committee  has  so  far  held  six  meetings  with  the  Principal  Secretary/  Secretary/  Labour Commissioners of all the States/ UTs to monitor the progress of implementation of the welfare provisions of the Act and utilization of the cess collected for the purpose.

## Annexure-I

Annexure as referred to in reply of part (b) to Unstarred Question No. 2228 to be answered on 28 th July, 2017 in Lok Sabha on the subject of Cess for Welfare Activities.

(Rs. in crore)

| Details of Cess                                     | Expenditure on Schemes out of Cess Fund                               | 2015-16   | 2016-17 (RE)   |
|-----------------------------------------------------|-----------------------------------------------------------------------|-----------|----------------|
| Primary Education Cess                              | Sarva Shiksha Abhiyan                                                 | 13589.13  | 13345          |
|                                                     | Mid Day Meal                                                          | 5709.03   | 5473.06        |
| Secondary & Higher Education Cess                   | Department of Higher Education                                        | 9271.72   | 9866.24        |
| National Clean Energy Fund (Clean Environment Cess) | Grid Interactive and Distributed Renewable Power                      | ...       | ...            |
|                                                     | Investment in Public Enterprises                                      | …         | …              |
|                                                     | Solar Power                                                           | 3112.33   | 2866.7         |
|                                                     | Wind Power                                                            | 325       | 496.95         |
|                                                     | Green Energy Corridors                                                | 300       | 200            |
|                                                     | Solar Energy Corporation of India Ltd                                 | ...       | 100            |
|                                                     | National River Conservation Prg                                       | …         | 167.5          |
|                                                     | Ghat Works for Beautification of River Front                          | 100       | 67             |
|                                                     | National Ganga Plan                                                   | 1000      | 1440.5         |
|                                                     | Other Schemes                                                         | 252.53    | 608.35         |
|                                                     | Climate Change Action Plan                                            | 120       | 42.66          |
|                                                     | National Mission on Himalayan Studies                                 | ...       | 16.5           |
|                                                     | National Adaption Fund                                                | …         | 96.94          |
|                                                     | Green India Mission-National Afforestation Programme                  | 70.22     | 101.1          |
|                                                     | Intensification of Forest Management                                  | …         | 44.54          |
|                                                     | Project Tiger                                                         | ...       | 21.2           |
|                                                     | Project Elephant                                                      | …         | 342.25         |
|                                                     | Integrated Development of Wildlife Habitats                           | ...       | 89.59          |
|                                                     | Conservation of Corals and Mangroves                                  | …         | 16.37          |
|                                                     | Biodiversity Conservation                                             | ...       | 9.3            |
|                                                     | Conservation of Aquatic Ecosystems                                    | …         | 59.99          |
|                                                     | National River Conservation Programme                                 | 54.72     | 77.99          |
| Rashtriya Swachhata Kosh (Swachh Bharat Cess)       | Swachh Bharat Mission - Rural                                         | 2400      | 10000          |
| Rashtriya Swachhata Kosh (Swachh Bharat Cess)       | Swachh Bharat Mission - Urban                                         | 1108.45   | 2091.46        |
| Krishi Kalyan Cess                                  | Crop Insurance Scheme                                                 | ...       | 3596.28        |
|                                                     | Interest Subsidy for Short Term Credit to Farmers                     | ...       | 5203.72        |
| Sugar Cess                                          | Financial Assistance to Sugar Undertakings/Other Expenditure of SDF   | 20.42     | 40.72          |
| Sugar Cess                                          | Scheme for Extending Financial Assistance to Sugar Undertakings, 2014 | 800       | 642.24         |

|                   | Incentive for Marketing and Promotion Services for Raw Sugar Production                                              | 200      | 41.4   |
|-------------------|----------------------------------------------------------------------------------------------------------------------|----------|--------|
|                   | Interest Subvention on Scheme for Extending Soft Loan to Sugar Mills, 2015                                           | 200.99   | 198.64 |
|                   | Production Subsidy to Sugar Mills to offset cost of Cane and facilitate timely payment of cane price dues of Farmers | ...      | 600    |
|                   | Subsidy on Maintenance of Buffer Stock of Sugar                                                                      | 3        | ...    |
|                   | Loans for Rehabilitation/ Modernization of Sugar Mills                                                               | 146.6    | 160.15 |
|                   | Loans to Sugar Mills for Cane Development                                                                            | 21.67    | 11.3   |
|                   | Loans to Sugar Mills for Bagasse based Co-generation of Power Project                                                | 95.79    | 230    |
|                   | Loans to Sugar Factories for production of Anhydrous Alcohol or Ethanol from Alcohol                                 | 38.64    | 90.5   |
| Jute Cess         | Payment to Development Council of Jute Manufacture against collection of Cess on Jute                                | 53.69    | 58     |
| Bidi Cess         | Bidi Workers welfare                                                                                                 | 177.2    | 206.64 |
| Mica Cess         | Mica Mines labour Welfare                                                                                            | 2.47     | 3.39   |
| Iron Ore          | Iron Ore Manganese Chrome Ore Mines labour Welfare                                                                   | 13.48    | 14.71  |
| LSDM              | Lime Stone and Dolomite Mines labour Welfare                                                                         | 12.41    | 12.99  |
| Cine Workers      | Cine workers Welfare                                                                                                 | 1.58     | 2.32   |
| Central Road Fund | Works under Roads Wing financed from CRF                                                                             | 11843.91 | 20638  |
| Central Road Fund | Schemes of States financed from Central Road Fund (CRF)                                                              | 2363.87  | 7070.7 |
| Central Road Fund | Schemes of UTs financed from CRF                                                                                     | 5.6      | 104.3  |
| Central Road Fund | Grants to Inter-State and Economically Important Roads - Schemes financed from CRF                                   | 267.09   | 805    |
| Central Road Fund | Development, Planning, Quality Assurance, Research and Training - Schemes financed from CRF                          | 39.19    | 83     |
| Central Road Fund | Maintenance of National Highways - financed from CRF                                                                 | ...      | 2041.4 |
| Central Road Fund | Pradhan Mantri Gram SadakYojana                                                                                      | 7653.5   | 13984  |
| Central Road Fund | Investment in NHAI                                                                                                   | 16517.68 | 7476.6 |

## Annexure - II

Annexure as referred to in reply of part (b) to Unstarred Question No. 2228 to be answered on 28 th July, 2017 in Lok Sabha on the subject of Cess for Welfare Activities.

Through Taxation Laws Amendment Act 2017, the following cesses are abolished:-

- i)       The Rubber Act 1947 - Cess on Rubber.
2. ii)      The Industries (Development and Regulation) Act 1951 - Cess on Automobile.
3. iii)     The Tea Act 1953 - Cess on Tea.
4. iv)     The Coal Mines (Conservation and Development) Act, 1974 - Cess on Coal.
- v)      The Beedi Workers' Welfare Cess Act 1971 - Cess on Beedis.
6. vi)     The  Water  (Prevention  and  Control  of  Pollution)  Cess  Act  1977  -  Cess  levied  on  Water consumed by certain industries and by local authorities.
7. vii)    The Sugar Cess Act 1982, the Sugar Development Fund Act 1982 - Cess on Sugar.
8. viii)   The Jute Manufacturers Cess Act 1983 - Cess on Jute Goods manufactured or produced or in part of Jute.
9. ix)     The Finance (2) Act 2004 - Education Cess on Excisable Goods.
- x)      The Finance Act, 2007 - Secondary and Higher Education Cess on Excisable Goods.
11. xi)     The Finance Act 2010 - Clean Energy Cess.
12. xii)    The Finance Act 2015 - Swachh Bharat Cess.
13. xiii)   The Finance Act 2016 - Infrastructure Cess and Krishi Kalyan Cess.

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