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'Best' corporation hikes property tax, parking charges

New Delhi, Dec 7, 2012, DHNS:

The South Delhi Municipal Corporation has come out with a budget for financial year 2013-14 which proposes an increase in taxes and parking charge, but without any major civic project.

The South Corporation, comprising the richest and elite areas of the city, is considered to be the most-well off of the three municipal corporations. The budget proposes an expenditure outlay of Rs 2,995.78 crore which is around Rs 600 crore less than North
Delhi Municipal Corporation, its poor cousin.

Aiming to make the corporation debt-free in five years, SDMC Commissioner Manish Gupta said the priority was to equal expenses with income and hence there was no room for new projects.


While the Corporation spared residential property owners, it increased property tax on commercial properties, residential properties which have been rented out and farm houses.

The property tax rate for rented commercial properties of A to E category has been increased from 15 per cent to 20 per cent, while the properties in F, G and H category will be charged with the property tax at 15 per cent rate.

Similarly, the rate of industrial properties has been increased to 15 per cent from the existing 12 per cent.

“All residential properties have been spared from hike. Our objective is to include maximum number of properties in the tax net so that revenue collection goes up automatically without burdening tax payers,” said Manish Gupta.

The corporation aims to increase property tax collection from Rs 581 crore in 2012-13 to Rs 702 crore in the next year.

Gupta also said the corporation is working on a new tax model to collect property tax which will have three key factors to make it a success - reform, rationalisation and recovery.

“At present, only 4.25 lakh property owners are paying taxes. But our assessment is that around 12 lakh properties will come under the tax net. We need to tap them. If we can bring them under property tax net we can increase our revenues by leaps and bounds,” the commissioner said.

Parking charges

The commissioner also proposed a new parking fee regime stating that it will discourage rampant use of private vehicles and promote the use of public transport.

Gupta said the civic body proposes to focus on multi-level and commercial parking rather than on surface parking. The parking lots have been divided into three categories depending on their location and the charges are fixed accordingly.

The first category includes premium surface parking lots like main markets, Lajpat Nagar, Defence Colony and others, while the second includes surface parking lots other than those mentioned in the former category. Multi-level, automatic and underground parking are included in the third category.

“To reduce problems on roads due to parking, we propose to increase rates for vehicles parked for long hours in the first and second category. This is to discourage parking for long hours and to help more people to get chance to park,” he said.
In the first category area, Rs 10 will be charged for one hour and Rs 20 for two hours. To park for six hours the rate will be Rs 50. And Rs 10 will be charged for every additional hour after six hours.

No new project

While the budget proposes that civic body will not require “ways and means” loans, one of the biggest determinants is that the budget has not come up with any major civic project.

Moreover, almost 50 per cent of its total expenditure outlay is for paying salary and pension of employees, which means a majority of expenditure will not be used in asset creation.

This is unlike the North and East Corporations, which have proposed a slew of ambitious projects in education, health and other community services. 
While BJP leaders welcomed the proposals stating that it does not burden the common man, the opposition leaders have termed it as a “visionless and directionless budget.

“As a resident of South Delhi, what do I have to look forward to from the budget? They have not proposed any civic development project,” Leader of Opposition, Farhad Suri said.

“The tax of commercial properties has been increased. They have done it when business is down due to recession. Why burden the business class when you are not giving them any facility,” he asked and added that rebate in property tax to senior citizens and women has been decreased.

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