Tax regimen in Punjab will soon be no more taxing for the Punjab Chief Minister, Cabinet Ministers, and the Leader of Opposition in Vidhan Sabha. Soon after the Chief Minister Capt Amarinder Singh ended up with a tax liability of Rs 17 lakh over his annual salary of Rs 13 lakh, the state lawmakers on Tuesday carried out an amendment in the respective laws.
It was in 2018’s budget session that the Vidhan Sabha had passed amendments in two legislations making the Ministers and the Leader of Opposition to pay their own income tax, leaving out the MLAs.
The income tax, being paid by the Punjab Government on this account, stands at Rs 11.08 crore, of which the bulk of Rs 10.72 crore is for payment of income tax of the MLAs. However, Congress MLA Kuljit Singh Nagra had offered to pay his own income tax, and is doing so since then.
Now, more than a year after, when the Chief Minister had the tax liability of Rs 17 lakh more than his annual salary of Rs 13 lakh, the Vidhan Sabha carried out an amendment to make the Chief Minister, Ministers, and the Leader of Opposition — all who have the Cabinet rank — to pay the income tax on their own on the “perks” they are getting.
Explaining, Finance Minister Manpreet Badal said that the Government had been paying the income tax on the salaries, allowances and the perks of Cabinet Minister. “The Chief Minister had advised that the Ministers pay their own income tax on salaries and allowances on their own. But, while omitting section 2-C of the East Punjab Ministers’ Salaries Act, 1947, we, by mistake, included the perks also,” he said.
He clarified that the Ministers would still be paying their income tax bon their salary and allowances, “the State Government would pay the tax on their perks which includes everything they get like houses, cars, even fans and lights”.
Tabling the three Bills related to the same — The East Punjab Ministers’ Salaries (Amendment) Bill, 2019, The Salaries and Allowances if Deputy Ministers, Punjab (Amendment) Bill, 2019, and The Salary and Allowances of Leader of Opposition in Legislative Assembly (Amendment) Bill, 2019 — quipped at Akalis, “those who have been doing this since past 72 years, are now opposing the bill”. All the bills were passed later on with SAD opposing the same.
As per the amendments, Section 2-C has been inserted since the intent of the amendment was that income tax on ‘Salaries and Allowances’ shall be paid by the Ministers and not on other perks and benefits allowed to them. The section stated, “The free furnished house and other perquisites admissible to a Minister under this Act shall be exclusive of income tax, which shall be payable by the Government.”
SAD MLA Harpal Singh Chandumajra opposed the Bill saying that the timing of moving the Bill, to “bestow largesse” on the Ministers, is wrong as there were many other requirements like the farmers, flood-hit people, salaries which should be considered first.
To this, Cabinet Minister Charanjit Singh Channi clarified that the Minister had already gave up their income tax on their salaries and allowances, which has been done by any state for the first time. “It is only that the tax on the perks will now be paid by the government and not the Ministers. The CM salary is Rs 13 lakh, but the income tax on perks is Rs 17 lakh...it is because if this we are carrying out this amendment,” he said.
Also participating in the discussion, Congress MLA Kuljit Singh Nagra pointed that I started paying my own income tax and asked the other MLAs, including effluent Akalis, to announce to do the same, besides foregoing the free power subsidy they are getting.
Reacting on this, the SAD MLA and the former minister Bikram Singh Majithia asked the Congress Ministers to give up their subsidy too.
Notably, since 1947, the government in Punjab had been paying taxes on salaries or allowances and perks of the ministers, till the Capt Amarinder government had decided to amend the law in March 2018. Section 2-C had provided for Income Tax to be paid by the state government on the salary, allowances, free furnished house and other perquisites admissible to the Chief Minister, Ministers, Deputy Ministers and LoP.
PUNJAB’S URBANITES TO PAY Rs 10p/LITRE CESS ON FUEL
Punjab Vidhan Sabha on Tuesday passed the Punjab Urban Transport Fund Bill, 2019, under which the state Local Government Department would impose a cess on petrol and diesel at the rate of 10 paise per litre in the urban areas.
As per the Bill, which came into force with immediate effect, the Department would also impose an additional 10 percent cess on the final price of an auctioned vehicle registration number.
Besides, in case of retaining of old VIP numbers and single digit numbers registration numbers, a fee ranging between Rs 2,000 and Rs 25,000 would be levied. It was also announced that funds worth Rs 25 crore would be used to fund urban transport system in the local bodies.