SDMC clears hike in prop­erty tax for com­mer­cial units

Hindustan Times (Noida) - - METRO - Vibha Sharma [email protected] n

THE CHANGES, WHICH WILL BE IM­PLE­MENTED FROM APRIL 1, ARE ES­TI­MATED IN­CREASE REV­ENUE COL­LEC­TION FOR THE SDMC BY ₹80 CRORE AN­NU­ALLY

THE South Delhi Mu­nic­i­pal Cor­po­ra­tion (SDMC) par­tially ap­proved the third mu­nic­i­pal val­u­a­tion com­mit­tee’s (MVC) re­port on Tues­day. While in­crease in prop­erty tax rate for res­i­den­tial prop­er­ties was re­jected, the im­ple­men­ta­tion of the re­port will lead to a sub­stan­tial in­crease in prop­erty tax for in­dus­trial and other non-res­i­den­tial ar­eas.

The changes, which will be im­ple­mented from April 1, are es­ti­mated to in­crease rev­enue col­lec­tion for SDMC by ₹80 crore an­nu­ally, se­nior of­fi­cials said.

The prop­erty tax is cer­tain per­cent­age of the an­nual value of prop­erty. The an­nual value of a prop­erty is de­ter­mined on the ba­sis of six fac­tors — age, unit area, struc­ture, oc­cu­pancy, area and use fac­tor.

Use fac­tor de­fined as the pur­pose for which the prop­erty is un­der use such as per­sonal, rent and/or com­mer­cial.

“The big­gest changes have been pro­posed in oc­cu­pancy, unit area and use fac­tor in MVC-III, while age and struc­ture fac­tors have re­mained un­changed. For ex­am­ple, for non-res­i­den­tial rented prop­er­ties, the oc­cu­pancy fac­tor has been made ‘two’ in­stead of ex­ist­ing ‘one’. That means, the amount paid by the oc­cu­pant will be dou­ble now,” said a se­nior SDMC of­fi­cial.

Like­wise, in case of in­dus­trial prop­erty ly­ing va­cant, the use fac­tor has been made ‘four’ from ex­it­ing ‘two’.

“Hun­dreds of in­dus­trial units have been ly­ing va­cant in Maya­puri and other in­dus­trial ar­eas for years. To dis­cour­age own­ers for leav­ing their units va­cant, we have de­cided to in­crease the use fac­tor,” said Bal­ram Oberoi, stand­ing com­mit­tee mem­ber and coun­cil­lor from Ra­jouri Gar­den.

For ban­quet halls, the use fac­tor will be in­creased from ex­ist­ing ‘four’ to ‘six’, and for guest houses it has been in­creased to ‘two’ from ‘one’.

“Keep­ing in view the hand­some rent earned by the prop­erty own­ers from telecom tow­ers, we have in­creased the use fac­tor of such build­ings from ‘two’ to ‘four’. Like­wise, for en­ter­tain­ment and recre­ational clubs such as swim­ming pools, cin­ema halls and malls, the use fac­tor has been in­creased from ‘three’ to ‘four’,” said the SDMC of­fi­cial.

NO HIKE IN RES­I­DEN­TIAL PROP­ERTY TAX

South Cor­po­ra­tion stand­ing com­mit­tee chair­per­son Shika Rai on Tues­day re­jected all pro­pos­als brought by the com­mis­sioner to hike taxes on the an­nual value of prop­erty to gen­er­ate rev­enue.

Rai also in­tro­duced an amnesty scheme to waive off 100% in­ter­est and penalty for res­i­dents who have not paid taxes since 2004.

In De­cem­ber, while pre­sent­ing the fi­nan­cial bud­get for year 2019-20, SDMC com­mis­sioner Puneet Goel pro­posed to hike tax on prop­er­ties fall­ing un­der A and B cat­e­gory at the rate of 14%, from the cur­rent 12%. Sim­i­larly, in the C, D and E cat­e­gories, tax bracket will be 12%, up 1 per­cent­age point. For the F, G and H cat­e­gories, tax will be 8%, in­stead of the 7%. The rates are based on the an­nual value of the prop­erty.

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