Brace for property tax hike, BBMP to slap additional 2% 'Land Transport Cess'

The Bruhat Bengaluru Mahanagara Palike (BBMP) is set to slap an additional two percent "Land Transport Cess" on the annual property tax it collects from citizens.

Rapped by the Comptroller and Auditor General (CAG) in 2017-18 and coming under intense pressure from the state government, the civic body has hinted at collecting the new cess from property owners in a few months.

The BBMP council on Tuesday resolved to seek permission from the state government to utilise the collected cess internally for the upkeep of roads, drains and street lights rather than handing over the revenue to some other department like the Directorate of Urban Land Transport (DULT).

The BBMP had dragged its feet over the collection of cess until the CAG rapped it in 2018. The CAG audit pointed out that the BBMP had lost out on revenues of Rs 95.63 crore for failing to collect Land Transport Cess between 2013-14 and 2016-17.

Now, as the civic body is coming under intense pressure to collect cess, it has decided to use the money to fund its various projects rather than handing it to another department.

Speaking to DH, K A Muneendra Kumar, leader of the ruling party in the council said, "Be it roads, drains or street lights, all of these are maintained by the BBMP. When we are spending on maintenance, why should we pay the collected cess to some other department? We will use it internally as we (BBMP) have been attending to such repairs."

Previously, the BBMP council, led by the Congress-JD(S) coalition in June 2018, had approved the proposal to reintroduce collection of "Land Transport Cess" to ensure better infrastructure for vehicles in the city. To allow for the collection of 2% of the property tax as Land Transport Cess, an amendment to the Karnataka Municipal Act (KMC) was made in 2013.

Ironically, this was vehemently opposed by BJP leaders, who said it would burden the taxpayers. However, the BJP-led BBMP council has now decided to introduce the cess.