No clarity on whether civic body will get a share of GST revenue | mumbai | Hindustan Times
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No clarity on whether civic body will get a share of GST revenue

mumbai Updated: Oct 21, 2012 00:37 IST
Kunal Purohit

While there continues to be confusion over the implementation of the goods and services tax (GST) and its impact on civic coffers, the BrihanMumbai Municipal Corporation (BMC) has decided to initiate a study to look into new sources of income, and on existing taxes that can be increased.

The study, to be conducted by Mumbai University's department of economics, will, among other things, consider taxing waste collection, and also impose property tax on slums, irrespective of their legal status.

The introduction of GST would mean that octroi, the BMC's single largest source of income, will be abolished. For 2012-13, the BMC had estimated that 35% of its income, which is nearly Rs 6,900 crore, was to come from octroi. With its abolition, the civic body's development works will be affected.

There is, however, confusion in the BMC over the fallout of GST.

"We need more clarity to decide the impact that GST will have on us. The state is yet to tell us whether it would be open to sharing the GST pie, and if so, to what extent. Since the state is anyway not in the position to give us a share, we want to look at having our own sources of income and be as self-reliant as possible," said a senior civic official.

It's this sentiment of self-reliance that is bound to make people jittery. For it to raise nearly Rs 7,000 crore that octroi currently generates, it will have to increase existing taxes, a possibility it doesn't deny.