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28-07-2023
Bureau Report + Agencies
NEW DELHI: Gig workers have welcomed a new law in India’s largest state Rajasthan to impose a tax on revenue earned by digital platforms that operate in the state, including global giants Uber and Amazon, even as industry groups have warned it will eventually hurt customers and derail business in the state.
Late at night on Monday, Rajasthan passed a law imposing up to 2 percent tax on revenue earned by digital platforms that operate in the state. The tax would go towards the welfare and social security of an estimated two million platform-based gig workers in the state, a first in the country and coming at a time when national elections are less than a year away.
The move, orchestrated by the Indian National Congress party which is in power in the state, has been welcomed by associations representing gig workers, who have over the past few years frequently organized to demand improved wages and social security benefits. The new rules are expected to kick in within the next two to three months.
Shaik Salauddin, founder and state president of the Telangana Gig and Platform Workers Union (TGPWU) and national general secretary of the Indian Federation of App-Based Transport Workers (IFAT), said gig workers “celebrate” the move and spearheaded the consultations with the government of Rajasthan on the bill’s provisions.
“We here at IFAT celebrate this day along with all our brothers and sisters who walked and contributed to this complex and difficult journey where a multibillion-dollar corporation has refused to recognize us, speak to us, and ignored our presence in the labor market,” Salauddin said in a statement.
India has an estimated 7.7 million platform-based gig workers, and according to state-run think tank NITI Aayog, the number is expected to rise to 23 million by 2030. But the majority of gig workers do not have social security benefits because they are employed in the country’s informal or unorganized sector.
The Rajasthan Platform Based Gig Workers (Registration and Welfare) Act 2023 establishes a welfare fund for gig workers which will be funded through this new tax that will be applied to each transaction on the platform. The tax shall not be more than 2 percent or less than 1 percent, as per the Act, and will be applied to a company’s revenue on that transaction and not to the customers.
