Development tax: Punjab govt to deduct Rs 800 from July’s salary of its staff

On Tuesday the issue created a stir as the state’s treasury refused to clear the salary bills for June and sent them back to the departments concerned, asking them to first deduct the Development Tax of Rs 600 for three months from April to June.

Punjab CM Amarinder Singh (Express photo/File)

The Punjab government will deduct Rs 800 each from the salary of its 3.5 lakh employees next month towards the Development Tax, which was decided to be levied every month during the Budget session, in retrospect. The amount is the tax for four months from April to July. The government has levied a tax of Rs 200 every month on the employees of Punjab government and private establishments from this financial year.

The state government, however, was yet to start collecting the Development Tax, despite instructions from the finance department. On Tuesday the issue created a stir as the state’s treasury refused to clear the salary bills for June and sent them back to the departments concerned, asking them to first deduct the Development Tax of Rs 600 for three months from April to June.

The employees feared if the bills were sent back to the departments Tuesday, their salary will be delayed by at least 10 days. They contended that the department heads would not be able to send these back for the next few days as it entailed paper work. The employees union then took a representation to Tejveer Singh, Principal Secretary to Chief Minister, urging the CM to ensure their salary on time.

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The Chief Minister is learnt to have then directed the finance department to clear the salary bills for June and has asked all the departments to ensure that the Development Tax is deducted in retrospect from next month.
By deducting Rs 800 each from the salary of 3.5 employees, the government will be able to collect Rs 28 crore for its exchequer next month.

Sources in the finance department said that the government was already comfortable financially this month as no bills were cleared since June 14 due to a snag in the server following load shedding in Secretariat.
The Development Tax willdbe used for paying the social security pensions of the government.

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Punjab