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All hotels, elite schools to pay same tax

delhi Updated: Jun 12, 2010 00:27 IST
Neelam Pandey
Neelam Pandey
Hindustan Times
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From next fiscal year, five-star hotels, elite schools and gymnasiums would have to pay more property tax. The Municipal Valuation Committee (MVC) has planned to make such premises independent of their location.

This mean, even if the hotel, school or gymnasium is located in far-flung areas, they will have to pay tax on par with their counterparts in other parts of the city.

At present, the areas under the Municipal Corporation of Delhi (MCD) have been divided into eight categories — A to H. Category A stands for upscale localities that pay the highest amount of tax.

These include localities such as New Friends Colony, Vasant Kunj and Anand Niketan, among others.

However, the MVC is now planning to do away with all these categories for high-end hotels and elite schools. The premises would now come under Category A, irrespective of their location.

There are 100-odd high-end hotels and schools that are located in E, F, G and H categories that pay a meagre amount of tax at present.

"There are a number of five-star hotels that are located on the outskirts of the city, such as near the airport. Their taxes are assessed according to the category they are in. For example, a hotel located in Mahipalpur, which falls under Category F, pays very low tax. But we have to understand that it is a five-star hotel, irrespective of the place it is located in. The money it charges from its customers is also according to any other five-star hotel. So they will have to pay the same tax," said a senior official.

According to the MVC, this shuffling of categories will help increase MCD's revenue earned through property tax.