No LTC amid pandemic; central govt employees to get cash vouchers this year

Finance Minister Sitharaman
Finance Minister Nirmala Sitharaman

The government has decided to give out out cash vouchers to central government employees this year, in place of leave travel concession (LTC) fare, Finance Minister Nirmala Sitharaman announced on Monday. 

The cash vouchers could be spent only on buying non-food GST-rated items. Finance Minister Nirmala Sitharaman said the employees could buy items that attract 12 per cent or more goods and services tax (GST). These purchases will have to be made in digital mode from GST-registered outlets.

Every four years, central government employees get LTC to any destination of their choice in India, 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, the minister added.

The demand infusion because of this would be Rs 19,000 crore, and another Rs 9,000 crore if half of the states follow this guideline, she added.

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