Gujarat's construction cess went up by 30 percent in FY23

The Gujarat government experienced a substantial surge of over 30 percent in its revenue from construction cess,
marking it as the most significant yearly growth to date, during the financial year 2022-23. The earnings generated
from the cess increased significantly from Rs 572 crore in 2021-22 to Rs 748 crore in the following year.
The government is confident that the collection of cesses this year will surpass the previous year's record. The
announcement stated that an amount of Rs 900 crore will be utilized for enhancing education, housing, and health
amenities for the families of construction labourers. The government of the state imposes a 1 percent surcharge on the
overall expense of constructing any building. These funds are utilized for the betterment of building workers and their
loved ones.
This marks the primary occasion where the collection of construction cess has risen by more than 30 percent. The rise
in numbers was attributed to improved supervision and expanded scope, according to officials from the state
government.
This fiscal year, the state government aims to allocate 900 crore rupees towards supporting welfare initiatives for
construction labourers. Anju Sharma, additional chief secretary of the labour and employment department, mentioned
that a total of Rs 900 crore will be utilized for the project, with Rs 400 crore sourced from this year’s cess collection
and Rs 500 crore from accrued funds from previous years.
The official stated that the 'sanman' portal will be the recipient of a range of welfare initiatives, which will be financed
through the construction cess portal. The allocated funds will be directed towards various essential sectors such as
education, healthcare, housing, and subsidized canteens for labourers. According to Sharma, measures such as offering
preventive health check-ups, the distribution of MA cards, and the deployment of Dhanvantri mobile vans will be
implemented to cater to the needs of labourers.
The Gujarat government reported that it generated a sum of Rs 1,606 crore through this surcharge from April 1, 2020,
until January 31, 2023, as disclosed during the budget meeting in March at the assembly. The revenue generated for

the financial year 2020-21 amounted to Rs 452 crore, whereas for the subsequent fiscal year, it increased to Rs 572
crore.
A cess refers to an additional tax duty imposed on a taxpayer beyond their initial tax responsibility. A levy is
commonly enforced as an extra charge when the state or federal government seeks to generate revenue for particular
objectives. Unlike typical taxes and levies, such as excise and personal income tax, a cess serves as an additional tax,
operating in conjunction with existing taxes (effectively a tax on top of a tax). Under the Employees Compensation
Act 1923, a 1 percent cess is levied on the total expenses incurred by an employer for building or construction work,
except for the costs of land and compensation given to a worker or their relatives.

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Gujarat's construction cess went up by 30 percent in FY23

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