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To get smart city tag, we will have to impose house tax, says Adviser

Says the idea is to ensure the civic body is able to maintain and increase level of public services

Written by Vivek Gupta | Chandigarh | Published: July 8, 2015 5:00:06 am

To make sure stagnating revenue of the Municipal Corporation does not come in the way of Chandigarh being selected under the smart city mission, the UT Administration is contemplating imposition of house tax with new rates, irrespective of the MC’s stand.

“Under smart city mission, the imposition of house tax is one of the core areas. It would be completely imprudent on the part of the administration to go to the government of India, saying we are front-runners for smart city mission but we don’t impose house tax in Chandigarh. Hence we have made very much clear to the Municipal Corporation to impose house tax as per norms, and we do expect cooperation from political parties as well on this issue,” Vijay Dev, Adviser to the UT Administrator, told Chandigarh Newsline.

Asked if the MC did not respond to the administration’s call on this matter, he said that the administration would ensure that house tax was implemented before submitting the proposal to the Central government under the smart city mission.

Significantly, according to the guidelines issued by the Union Ministry of Urban Development for the smart city mission, cities will be evaluated more on their revenue-generation capacity and delivery mechanism rather than current infrastructure.

On this count, the UT civic body fares badly as its own revenue generation is stagnant; it currently stands close to Rs 140 crore due to low user charges and non-collection of house tax from residential area. In terms of percentage, it is more than 20 per cent of the MC’s overall annual budget.

In 2013, in order to claim the Central grant under the Jawaharlal Nehru National Urban Renewal Mission, the MC imposed just Re 1 per square feet per annum as house tax, which the UT suspended a year later, since the amount imposed was inappropriate.

Despite the administration’s repeated requests to increase house tax, the matter was opposed by political parties across the board on the floor of the MC house.

The idea behind imposing house tax, Dev said, is to ensure that the civic body is able to maintain and increase the level of their public services, which is one of the major aspects in making cities smart.

“We would also release a public charter through MC which will tell city residents that through imposition of this tax, how we are going to make provisioning of civil services better for them,” he said, adding that people are ready to pay house tax provided they get a sense of credibility that the MC would improve the service delivery.

On how much funds the city will get once selected in phase-1 of the smart city mission, Dev said, “The apportionment of funds city-wise has not yet been done by the government of India but they have said that it would mainly depend on what kind of city project report is being submitted to them. If they find that the city project report is worthwhile then there is no limiting factor.”

The city’s focus under this mission, he said, is the wider use of IT-related services in public delivery and urban mobility. “The city will separately seek funds under the Atal Mission for Rejuvenation and Urban Transformation to improve the basic infrastructure,” he said.

According to Local Secretary Anurag Agarwal, calculation of house tax has been done as per the norms already fixed in the Punjab Municipal Act, as applicable to the UT. “Even if we lower our rates by 20-25% as being charged in Panchkula and Mohali, we are eying to collect at least Rs 25 crore house tax in UT,” he said.

Officials said that for a 5-marla house (125 square feet), house tax fixed in 2013 was Rs 125 but the UT recently proposed over Rs 2,000 per annum.

Similarly, the proposed annual rate for 7.5- and 10-marla house is Rs 3,200 and Rs 4,300 respectively while the amount ranges from Rs 10,000 to 20,000 for one-kanal and two-kanal houses.

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