Everything You Need To Know About Swachh Bharat Tax On Services From November 15

Al Arafat Sherfuddeen

November 7th, 2015

Image Source: thehindubusinessline

What is cess?
A tax on tax

The news
The government has announced a new “cess” on service tax i.e., a 50 paisa contribution for every 100 rupees spent. Hence your movie tickets and air travel among many others will marginally increase with this cess ( a tax on tax).

Objective

To raise funds for Swachh Bharat. The implementation of cess makes many millions of Indian’s to contribute for a clean India. The funds raised will be used to build toilets to ensure open defecation is a thing of the past. It is worthwhile noting that half of Indian’s do not have access to proper toilet facility and hence defecate in open which has resulted in many communicable diseases with huge health consequences and in turn burdening the government’s health budget.

Why the cess is being welcomed?

Indian’s all uniformly share the aspirations of a clean India in the lines of many western nations. With many Indian’s travelling abroad and visiting other nations, the aspiration for a clean India has never been higher. Hence the chance for every citizen to contribute for clean India by the Swachh Cess is widely welcomed by many.

What do the critics say?

1.) The already existing funds have been spent poorly. To have spent 100 crores for the ad campaign for one scheme is close to being unprecedented.

2.) States have been burdened with more expenditure (twice than the central government) for Swachh Bharat without subsequent increase of revenue through taxes.

3.) Rural Sanitation – Despite the noble objectives of Swachh Bharat, the budget for rural sanitation programs have been has been reduced to Rs 3,500 crores. It is worthwhile to note that, the problem of open defecation is more acute in rural household’s and hence the budgetary cuts go against the very notion of swacch Bharat.

TLI hopes the raising of funds through cess will enhance allocation to states and corporations who are closer to the ground level governance. We also hope the coming budgetary allocation for sanitation schemes will improve and instead of making investments in ad campaign, emphasis on ground work is done. Rest assured the TLI community stands by our Prime Minister in its commitment in bringing about a clean and better India.

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