Finance Minister Nirmala Sitharaman, on October 12, announced a Leave Travel Concession (LTC) cash voucher scheme to increase consumer spending.
Under this LTC Cash Voucher Scheme, government employees can opt to receive cash amounting to leave encashment, plus three times ticket fare, to buy items which attract a GST of 12 percent or more. Only digital transactions allowed, GST invoice to be produced, FM Nirmala Sitharaman said.
"Every four years, central government employees get LTC to any destination to their choice plus one to their hometown. Since travel is difficult to undertake during the pandemic, the government will pay the entitled fare as cash vouchers which have to be spent by March 31, 2021," she said.
Central government payout on cash-in-lieu-for-LTC will be Rs 5,675 crore, and another Rs 1,900 crore will be payout by central PSUs and public sector banks, Sitharaman said.
The tax concession will be allowed for the State Government/Private sector too, for employees who are currently entitled to LTC, subject to following the guidelines of the Central Government scheme.
Frequently Asked Questions
A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.
There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.
Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.
Demand infusion in the economy by Central Government and Central PSE/PSB employees is estimated to be Rs. 19,000 crore approx.
The FM said that the demand infusion by State Government employees will be Rs. 9,000 crore. Additional consumer demand generated will be Rs. 28,000 crore.
Indications are that savings of govt. and organized sector employees have increased, we want to incentivize such people to boost demand for the benefit of the less fortunate
- Finance Minister @nsitharaman, presenting LTC Cash Voucher Scheme to stimulate consumer spending pic.twitter.com/XDLzUisi3r
— PIB in Maharashtra
Estimated cost of LTC Cash Voucher Scheme
For Central govt. : ₹ 5,675 crore
For PSBs & PSUs: ₹ 1,900 crore
Tax concessions for LTC tickets available for state govt. & private sector too, if they choose to give such facility, these employees too can benefit - @nsitharaman pic.twitter.com/Uu2X248jjB
— PIB in Maharashtra (@PIBMumbai) October 12, 2020