Living near metro lines may get 'taxing'

Govt mulls new tax to generate revenue for more projects

People living close to metro lines may have to pay more tax as the Centre has asked states to explore the option of imposing a ‘dedicated tax’ as part of an innovative method to generate revenue. The money will be used to finance similar public transport projects.

Taking a cue from Karnataka government’s decision to launch an ‘infrastructure tax’ by imposing cess on certain items, the Union urban development ministry has written to state governments, seeking their opinion on levying additional tax on land transactions near metro corridors.

The proposal also seeks to impose a levy of 10 per cent on additional floor area ratio (FAR) along metro lines.

“Setting up the metro network involves huge cost. While the network is expanding in the Capital, other cities are coming up with metro projects. So we must search for innovative sources of revenue generation. One among them is to levy taxes,” said Union urban development secretary Sudhira Krishna.

Krishna refuted claims that people living in the vicinity of metro corridors are being “punished” for choosing their houses there. “It is not an enormous increase. The tax will be a nominal amount, and it is inevitable because Delhi Metro has to repay the loan it took,” he said.

He said 75 per cent of the funds raised through such a tax will go to the Centre’s ‘dedicated urban transport fund’. This amount will be used for extension of several projects. But state governments are free to decided the rate of taxation, he added.

Metro conducts study

Delhi Metro has undertaken a ‘transit-oriented development’ study to develop ‘street connectivity’ on a 7-km-long stretch of metro corridor between Chhattarpur and Arjangarh stations on Jahangirpuri-Huda City Centre line.

The study is part of an effort to fund additional metro projects and make the transport system efficient by using private sector investment along metro corridors.

The scope of the study is confined to 1,500 metres of catchment area from metro stations in Chhattarpur, Sultanpur, Ghitorni and Arjangarh, where development of commercial and residential complexes may be considered.

“Transit-oriented development is essential. We need to adapt to economical models of development,” said urban development secretary Sudhir Krishna.

The DMRC has also begun work on the proposal and given a tender to a specialised agency, which will come up with the initial designs for the first stage of the project.

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