AAP govt discusses finance panel suggestions

The Delhi cabinet on Friday briefly discussed the recommendations of the latest Delhi Finance Commission which will determine the allocation of funds to  the civic agencies from the government’s revenue collection.

No decision was taken on the recommendations as Chief Minister Arvind Kejriwal is in Bengaluru.

The cabinet note on the Commission’s recommendations was prepared on the instructions of new Chief Secretary K K Sharma.

The note was aimed to help determine the future sharing of tax revenue between the Delhi government and the civic agencies which have been complaining of a financial crunch.

The three BJP-run municipal corporations have been complaining about a reduction in their share in the city’s tax revenue and grants. The  corporations have also complained about a cut since 2012 in money from the Municipal Reform Fund.

An official said the recommendations of the Commission will apply to all the three corporations.

The term of the Fourth Delhi Finance Commission was earlier extended till March 31, 2013, and it was given a special task of suggesting measures for distribution of assets and liabilities of the Municipal Corporation of Delhi among the three newly created corporations.

The recommendations review the financial position of the municipalities, and distribution between them and the  Delhi government of the net proceeds of taxes, duties, tolls and fees levied by the government.

The grants-in-aid to the municipalities from the Consolidated Fund of the National Capital Territory of Delhi was also an area of focus.

One pending issue is financial aid to the corporations for introducing in 2004 the unit area method of calculating property tax in place of the system which used the rateable value of property.

The cabinet note touched upon  suggestions of the Commission on  avoiding duplication of responsibilities between the Delhi government and the municipalities.

Sources said the note may also help the government consider a proposal to put in place a mechanism for making the municipalities more accountable  regarding the functions assigned to them.