In a significant move aimed at bolstering social security for the state's vast gig economy workforce, the Karnataka government has proposed imposing a welfare fee on aggregator platforms. The fee, intended to fund welfare measures for delivery and ride-hailing partners, is likely to be set between 1% and 1.5% of the transaction value.
Minister Announces Impending Notification
Labour Minister Santosh Lad confirmed the development, stating that extensive discussions with various stakeholders have been concluded. The minister revealed that the stakeholders themselves suggested the fee range of 1% to 1.5%. He indicated that the formal government notification detailing the levy and its mechanism is slated to be issued very soon, potentially within the next week.
Stakeholder Consultations Shape the Proposal
The proposed fee is a key component of the state's efforts to implement welfare measures under the broader framework of legislation for platform workers. The government's approach has been consultative, engaging with the aggregator companies, worker associations, and other relevant parties to arrive at a mutually agreeable figure. The suggestion of the 1-1.5% range originating from these stakeholders points towards a collaborative, albeit mandated, effort to address worker welfare.
Implications for the Gig Economy
This move by the Karnataka government marks one of the first concrete steps in India to directly link a financial contribution from aggregators to a dedicated welfare fund for gig workers. The funds collected are expected to be channeled into schemes providing insurance, health benefits, or other forms of financial security for the workers, who are currently classified as independent partners without traditional employment benefits. The final notification, expected by mid-January 2026, will provide clarity on the exact percentage, collection method, and administration of the welfare fund.
The development is being closely watched by other states and could set a precedent for similar social security models across the country for millions engaged in the platform economy.
