Union Human Resources Development Minister Murli Manohar Joshi looks set to spark another controversy with his proposal for a tax surcharge to fund universal schooling in the country.

The human resources development ministry has drawn up a draft Bill to enable the Centre to levy the surcharge. The Bill, Free and Compulsory Education Bill 2004, will be a priority for Joshi if the National Democratic Alliance returns to power.

Although the draft Bill had enough provisions for resource mobilisation at the local level for funding universal schooling, sources close to Joshi said the surcharge would be imposed on corporate houses.

The clause in the draft Bill that enables the government to do this says, "The central government may, by notification, levy a surcharge on an existing tax levied by it, at a rate not exceeding 5 per cent of such tax, for rendering financial assistance to state governments." Officials said the nature of the surcharge would be explained in a notification after the law was enacted.