Labour cess

This query is : Resolved

Sonia (Querist)
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16 August 2017 Is labour cess of 1% for construction applicable in Hosur (Tamil Nadu)?
I know it is a central tax but collected by states.
Should employer deduct Labour cess @ 1% from monthly bills of contractor?

Guest

Guest (Expert)

26 August 2017 Labour cess is applicable for all states including TN. If the contract is related to road or other building construction, the the cess need to be deducted.

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Sonia

Sonia (Querist)
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29 August 2017 Sir,
Thanks for the reply. Kindly attach notification or circular by TN govt which says this. Or let me know from which website I can get an official document stating this

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Sonia

Sonia (Querist)
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29 August 2017 Sir,
We are doing a project in Hosur, approximate cost is 4.5 crores, its construction of factory building with office. We do not know will we get next project at TN or not. So, is labour cess @ 1% is applicable even if its for one project?
Kindly reply

Guest

Guest (Expert)

02 September 2017 Dear MS Sonia, If the building construction is related to government or public sector undertaking then the cess is to be paid. Even if there is single contract with government, the cess is to be paid. If you sub-contract the work to anyone, you have to deduct 1% on the sub-contractors' cost. If the government has already deducted 1%, then you can claim this as paid. Please feel free to contact me for any queries as there is no awareness of this legislation. Also include land cost in it if you buy land for computing 1%