AFTER MUCH DELAY
After yrs of delay, govt gives nod for property tax hike
TIMES NEWS NETWORK
Chennai/ Madurai/ Trichy:24.07.2018
The state government has given its nod to urban local bodies— the Greater Chennai Corporation, 11 other municipal corporations, 124 municipalities and 528 town panchayats— to effect revision of property tax with effect from April 1, 2018.
Municipal administration and water supply department issued an order in this regard on Thursday. The proposed revision of property tax will not be more than 50% for residential buildings and not more than 100% for rented residential and non-residential buildings. “Necessary guidelines for the general revision of property tax will be issued by the commissioner of municipal administration, commissioner of the GCC and director of town panchayats separately by following the stipulated guidelines,” the order said.
As per relevant laws, the local bodies should have effected revision of tax every five years. But to appease the electorate and owing to poor fiscal management, the policymakers have not revised property tax for years. For instance, Chennai Corporation has not seen any revision since 1998. Other corporations and municipalities had their last revision in 2008. The last revision was in the range of 25% to 150% for residential and commercial properties. Thanks to the court intervention, the heads of the departments requested the government in June and July seeking orders to carry out general revision of tax in the urban local bodies.
A division bench of the Madras high court recently directed the state government to take a decision regarding the proposals within two weeks and report to the court at the time of next hearing. The case is coming up again on August 3. “The previous revision should have taken place in 2013, but the government could not do it owing to various reasons. This time there will be attempts to rationalise the differences to a large extent,” said a senior government official. As regards Chennai, the disparity between the expanded areas annexed to the local body and the core areas would be resolved, the official said.
Insiders say a large chunk of property tax goes towards salaries and administrative expenditure, and the local bodies are left to wait for government grants and Central assistance to meet capital expenditure. For instance, Chennai Corporation collected ₹720 crore property tax from more than 12 lakh assesses last year, but the capital expenditure was around ₹2,034 crore.
With as many as 2.1 lakh assessments across 65 wards of Trichy, the civic body maintained that the proposed revision in property tax is much needed for them to maintain Tamil Nadu’s cleanest city, as per Swachh Survekshan 2018 (cleanliness survey). “Electricity tariff has seen a steep hike in the past 10 years, and expenditure such as salary and pension benefits has been adding to our burden. Though 50% to 100% hike in property tax is hefty, it is needed for seamless operations
of civic bodies,” a senior official in Trichy Corporation said. The civic body charges between ₹1.34 and ₹2.30/sqft for residential buildings while for commercial buildings, the present tax slab is between ₹4.01 and ₹6.87/sqft.
Madurai corporation commissioner Aneesh Sekhar said the move would help the local body implement many welfare schemes. “It has been ten years since the last revision. A huge increase in expenditure in the meantime has affected developmental activities,” Sekhar said.
After yrs of delay, govt gives nod for property tax hike
TIMES NEWS NETWORK
Chennai/ Madurai/ Trichy:24.07.2018
The state government has given its nod to urban local bodies— the Greater Chennai Corporation, 11 other municipal corporations, 124 municipalities and 528 town panchayats— to effect revision of property tax with effect from April 1, 2018.
Municipal administration and water supply department issued an order in this regard on Thursday. The proposed revision of property tax will not be more than 50% for residential buildings and not more than 100% for rented residential and non-residential buildings. “Necessary guidelines for the general revision of property tax will be issued by the commissioner of municipal administration, commissioner of the GCC and director of town panchayats separately by following the stipulated guidelines,” the order said.
As per relevant laws, the local bodies should have effected revision of tax every five years. But to appease the electorate and owing to poor fiscal management, the policymakers have not revised property tax for years. For instance, Chennai Corporation has not seen any revision since 1998. Other corporations and municipalities had their last revision in 2008. The last revision was in the range of 25% to 150% for residential and commercial properties. Thanks to the court intervention, the heads of the departments requested the government in June and July seeking orders to carry out general revision of tax in the urban local bodies.
A division bench of the Madras high court recently directed the state government to take a decision regarding the proposals within two weeks and report to the court at the time of next hearing. The case is coming up again on August 3. “The previous revision should have taken place in 2013, but the government could not do it owing to various reasons. This time there will be attempts to rationalise the differences to a large extent,” said a senior government official. As regards Chennai, the disparity between the expanded areas annexed to the local body and the core areas would be resolved, the official said.
Insiders say a large chunk of property tax goes towards salaries and administrative expenditure, and the local bodies are left to wait for government grants and Central assistance to meet capital expenditure. For instance, Chennai Corporation collected ₹720 crore property tax from more than 12 lakh assesses last year, but the capital expenditure was around ₹2,034 crore.
With as many as 2.1 lakh assessments across 65 wards of Trichy, the civic body maintained that the proposed revision in property tax is much needed for them to maintain Tamil Nadu’s cleanest city, as per Swachh Survekshan 2018 (cleanliness survey). “Electricity tariff has seen a steep hike in the past 10 years, and expenditure such as salary and pension benefits has been adding to our burden. Though 50% to 100% hike in property tax is hefty, it is needed for seamless operations
of civic bodies,” a senior official in Trichy Corporation said. The civic body charges between ₹1.34 and ₹2.30/sqft for residential buildings while for commercial buildings, the present tax slab is between ₹4.01 and ₹6.87/sqft.
Madurai corporation commissioner Aneesh Sekhar said the move would help the local body implement many welfare schemes. “It has been ten years since the last revision. A huge increase in expenditure in the meantime has affected developmental activities,” Sekhar said.
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