In a significant policy shift, the Madhya Pradesh Cabinet has decided that state ministers will now be responsible for paying their own income taxes on salaries and allowances. This decision, which overturns a rule from 1972, was proposed by Chief Minister Mohan Yadav during a recent Cabinet meeting.
Urban Administration Minister Kailash Vijayvargiya announced, ‘The Chief Minister suggested that ministers should pay their own income taxes on allowances, rather than having the state government cover these taxes. The Cabinet has decided to end the provision allowing the state to pay these taxes.’
The move has faced criticism from the opposition. Congress state president Jitu Patwari argued that the government should focus on curbing wasteful expenditures like purchasing aeroplanes, decorating official residences, and buying luxury cars.
The now-abolished provision, as per Section 9K of the Madhya Pradesh Ministers (Salary and Allowances) Act, 1972 exempted ministers from paying income tax on allowances and other perquisites, with the state bearing the cost. Officials from the Finance Department explained that this law was originally enacted to ensure ministers from poor backgrounds were not burdened by income tax.
With the new decision, officials anticipate ‘direct financial savings for the state’ and ‘better allocation of resources towards development projects and public services.’ One official highlighted that this move promotes a culture of responsibility and aligns with public expectations of transparency in governance. ‘Ministers paying their own taxes will reduce unnecessary expenditure from the state budget, allowing funds to be redirected to essential services and development projects. The state is currently reeling from a financial burden,’ the official noted.
This policy change aligns Madhya Pradesh with other states that have amended similar provisions. In 2019, Uttar Pradesh revised its law to require the Chief Minister and other ministers to pay their own income taxes. Similarly, Himachal Pradesh mandated in 2022 that all ministers and MLAs pay their own income taxes, a cost previously covered by the state government.
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