BBMP all set to plug tax leak

The Bruhat Bangalore Mahanagara Palike has drawn an elaborate plan to boost its tax income from commercial establishments. The civic agency hopes to collect not less than Rs six crore with its measures.

It has been planned to plugg loopholes in the sytem and rationalise the basis for computation of tax. Though there are at least two lakh commercial establishments in the City, the BBMP has issued trade licences to only 35,000 of them. Of these, only 2,000 pay taxes regularly.

Palike Commissioner N Lakshminarayana said they had introduced an online system to enable unlicensed established to register their businesses. Those not falling in line will have to pay heavy fine, he said. Assistant Revenue Officers are on the job to verify compliance, he added.

There have been several other instances of revenue leak. For example, commercial establishments that are given licences for photocopying purposes, start selling mobile phones and other electronic goods, which come in a higher tax bracket. In such cases, taxes from these outlets would be reworked to reflect change in natureof business, he said.

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BBMP Additional Commissioner (Advertising) Manjunath Swamy told Deccan Herald that some outlets also sell advertising space and the Palike will ensure that such outlets are taxed for advertising space as well.

Officials have estimated that of the 35,000 registered outlets, some 15,000 use space available to them for advertising.

Another area of concern is that under the self-assessment scheme, owners of commercial establishments have largely tended to undervalue their property and business, so as to pay lesser tax. The BBMP move includes setting right this anomaly too.

The BBMP had initially intended to outsource the inspection to a private company. But the response was poor and the rates being quoted by them were much higher than what the Palike was prepared to pay.

Eventually, the move was dropped and instead, the BBMP roped in officials from other departments for the job. Health officials and other staff who are usually on field duty have been asked to double up and check on commercial establishments.
DH News Service