Debt may force corporations to hike property tax on commercial buildings
The debt-laden municipal corporations of Delhi are planning to increase property tax rates on commercial properties to overcome their looming financial crisis.delhi Updated: Jun 07, 2012 23:34 IST
The debt-laden municipal corporations of Delhi are planning to increase property tax rates on commercial properties to overcome their looming financial crisis.
With a debt of around Rs 2,100 crore, the financial situation of the BJP-ruled corporations has turned red and if they don’t increase their revenues, it is understood that they won’t be able to pay salaries to their employees in the coming months.
But getting the property tax hike proposal passed would be a big challenge for the corporation leaders as the state leadership of the party is reluctant to increase tax rate in the wake of upcoming Assembly elections.
“Before the civic polls, we had promised that no tax will be increased, but with the looming financial crisis, it has become difficult to keep our promise,” said a senior North Delhi Municipal Corporation (NDMC) official.
“We also have to repay a loan amount of over Rs 2,100 crore due against the erstwhile corporation that will be shared by the three newly constituted corporations,” he added.
The corporation leaders are trying hard to persuade the state leadership to let them increase the property tax on commercial buildings as it won’t hit the common man directly.
The proposed hike in the tax rates of commercial establishments will affect shopping complexes, hotels and malls.