New Delhi: In a bid to stimulate demand in the economy, the Narendra Modi-led government on Monday announced giving out cash vouchers to central government employees this year in lieu of leave travel concession (LTC) fare which could be spent only on buying non-food GST-rated items.
The announcement was made by Union Finance Minister Nirmala Sitharaman, ahead of the scheduled Good and Services Tax (GST) Council meeting today. “The pandemic has adversely affected the economy. The needs of the poor and weaker sections addressed in various announcements by the govt. Supply constraints have somewhat eased but consumer demand still needs to be given a boost”, said the finance minister.
Under LTC Cash Voucher Scheme, government employees can opt to receive cash amounting to leave encashment plus 3 times the ticket fare, to buy items that attract GST of 12% or more. Only digital transactions allowed, GST invoice to be produced, said Sitharaman.
She asserted that if Central govt employees opt for it (LTC voucher scheme), this will cost around Rs 5,675cr.
“The employees of PSBs & PSUs allowed to avail this facility, and for PSBs & PSUs the cost will be Rs 1,900 crores. The demand infusion in the economy by central govt & PSUs will be approx Rs 19,000 cr”, Sitharaman said, adding that even if 50% of the States opt to give this facility, we think that this will bring in Rs 9000 crores.
Notably, every four years, central government employees get LTC to any destination to their choice plus one to their hometown.
