2% Swachh Bharat cess, 100% deduction on investment in Kosh

Government today proposed a 2% Swachh Bharat cess on Service Tax and allowed 100% deduction on investment in Swachh Bharat Kosh.

However, the contribution to Swachh Bharat Kosh as part of the CSR activities by corporates will not be entitled for tax exemptions.


"In my direct tax proposals, I have proposed 100% deduction for contributions, other than by way of CSR contributions, to the Swachh Bharat Kosh," Finance Minister Arun Jaitley said in Budget 2015-16.

He said a similar tax treatment is also proposed for the Clean Ganga Fund.

Jaitley further proposed to an enabling provision to levy Swachh Bharat Cess at a rate of 2% or less on all or certain services, if need arises.

"This Cess will be effective from a date to be notified. Resources generated from this cess will be utilised for financing and promoting initiatives towards Swachh Bharat," he added.

There will be 100% deduction on contributions to the Prime Minister's National Relief Fund.

'Swach Bharat Kosh' has been set up to attract funds from various entities, including corporates, for activities related to Swachh Bharat initiative. The 'Clean Ganga Fund' is aimed at pooling money for taking up works to clean the Ganga river.

Swachh Bharat and Clean Ganga are among the major initiatives of the Narendra Modi government, which has embarked on a major drive to ensure cleanliness across the country.