PMC budget proposes 12 hike in property tax

  • | Friday | 18th January, 2019

It is for the third consecutive year that the civic administration has proposed a rise in the property tax. “About 44% property tax was collected till December as against the target of Rs 1,691.91 crore,” the sources said. We, therefore, are concentrating on how tax collection can be optimized. The PMC’s tax recovery mechanism has failed to yield any results. He also assured of a significant increase in tax collection in 2019-20.

PUNE: Municipal commissioner Saurabh Rao proposed a 12% increase in the collective property tax in the Rs 6,085 crore draft civic budget for 2019-20, which was presented before the standing committee on Thursday.Over Rs 200 crore more than the last year’s budget of Rs 5,870 crore, it is for the first time that the PMC budget has crossed the Rs 6,000-mark. As for the hike in property tax, it would include 5.5% rise in general tax, 1.5% in water benefit tax and 5% in sewage benefit charges.“The civic administration expects to earn an additional income of Rs 110 crore from the proposed hike,” Rao said, while delivering the budget speech.The proposal, also applicable for the cellphone tower companies, IT and ITES companies, will have to be approved by the standing committee and general body before its implementation. Besides the hike in property tax, the residents will also have to pay an additional 15% amount in water tax, which has already been approved by the general body as a part of the 24X7 water supply project implementation.While proposing the increase in the tax, Rao said efforts would be made to improve the efficiency of tax collection. He also assured of a significant increase in tax collection in 2019-20. “The civic body has limited sources of revenue. Among these, tax collections forms a major share. We, therefore, are concentrating on how tax collection can be optimized. The administration is planning extensive steps to push up the collection and recovery of pending taxes. There is a plan to re-asses properties and introduce IT-based programmes to monitor the recovery and curb loopholes,” he said.Last year’s budget stood at Rs 5,870 crore. It is for the third consecutive year that the civic administration has proposed a rise in the property tax. Last year, the administration had proposed a 15% increase in the levy, which was later rejected by the standing committee and the general body of the PMC.Activists fume over “unnecessary” burdenThe proposed hike in the property tax has left activists fuming, who said the civic administration should concentrate on recovery of tax dues, instead of putting additional burden on regular taxpayers.Activist Vivek Velankar said, “We strongly oppose the proposal to increase the property tax and impose user fees to reduce the deficit in the solid waste management costs. The PMC’s tax recovery mechanism has failed to yield any results. The administration has not been able to meet the revenue targets because of low recovery of taxes and should not make citizens pay for its inefficiency.”Sources in the PMC admitted that the administration was facing a challenge to meet tax collection target in the current fiscal. The civic body is eyeing a collective revenue of Rs 5,870 crore in 2018-19. Till December, the administration was able to mop up only Rs 3,054 crore. “About 44% property tax was collected till December as against the target of Rs 1,691.91 crore,” the sources said.

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