Karnataka will implement a 5% cess on aggregator platforms, including Amazon, Flipkart, Ola, and Uber, to establish a gig workers’ fund, Chief Minister Siddaramaiah said on April 3.”The platforms will pay a 5% cess of the total payout to gig workers. The state government will provide additional funds to support welfare schemes for gig workers,” Siddaramaiah said.
A senior official explained that the 5% cess applies to worker payouts, not the total transaction value.
The announcement follows Siddaramaiah’s meeting with Congress leader and Leader of the Opposition in the Lok Sabha Rahul Gandhi in Delhi regarding the Gig Workers’ Bill. The meeting took place amid reports of disagreement among state ministers about the Bill.The Chief Minister’s Office said the Karnataka government will create a Gig Workers’ Welfare Board to support workers at companies like Amazon, Flipkart, Ola, and Uber.Karnataka Labour Minister Santosh Lad told Moneycontrol: “The Karnataka Platform-Based Gig Workers Bill suggests a 1-2% cess per transaction for the gig workers’ fund. The cabinet will decide the final cess percentage. The Social Security Code permits up to 5% cess.”
The Code on Social Security 2020 requires platforms employing gig workers to contribute 1-2% of annual turnover—with a 5% cap on worker payments—toward social security, covering life, disability, accident insurance, and health benefits.The Bill’s presentation, planned for last year, faced delays due to ministerial differences. Labour Minister Santosh Lad supported the bill, while IT-BT Minister Priyank Kharge and Industries Minister MB Patil expressed concern about its effect on startups and industries. All three ministers joined the meeting at Gandhi’s residence.The Chief Minister said they will draft a complete bill addressing gig worker welfare for cabinet approval.Industry organisations NASSCOM and IAMAI have raised questions about the bill’s provisions, saying they could affect business operations in Karnataka.Shaik Salauddin, National General Secretary of the Indian Federation of App-Based Transport Workers, who attended the meeting, said: “The Karnataka Gig Workers’ Bill represents progress in recognising gig and platform workers as vital economic contributors. The legislation must guarantee fair wages, job security, and social protection for app-based economy workers.””We back gig and platform workers throughout Karnataka and India. The government must keep this bill worker-focused, with fair wages, social security, and safety measures,” he added.Also read: Indian startups need a reality check: Commerce Minister Piyush Goyal at Startup Mahakumbh
