E-Paper
Chandigarh MC seeks EC nod for granting rebate for property tax
Every year, from April 1 to May 31, MC gives a 20% rebate for residential properties and 10% rebate for commercial properties on complete property tax payment for the fiscal
With the model code of conduct in force ahead of the Lok Sabha elections, the Chandigarh municipal corporation has written to the Election Commission of India, seeking permission to grant rebate on property tax payments for the financial year 2024-25, starting from April 1.
“If the grant is not given and the public notice for the same is not issued before March 31, the assessees may delay the payment of the property tax up to the last quarter of the financial year, which may not only create financial crunch for MC, but will also result in loss of interest on the advance payments,” civic body officials wrote in the letter.
Every year, from April 1 to May 31, MC gives a 20% rebate for residential properties and 10% rebate for commercial properties on complete property tax payment for the fiscal.
After the rebate period, a 25% penalty and interest at 12% per annum is levied on the due tax from the date of issue of the tax bill to the date of actual payment.
“As per the budget estimates of fiscal year 2024-25, the civic body aims to generate revenue of over ₹85 crore from property tax collection. Every year due to this statutory rebate, more than 80% of the target is achieved up to May 31,” states the letter.
“The model code of conduct is enforced up to June 6 and the last date of rebate is May 31. Therefore, if this relaxation is not granted, it will create a great financial crisis for MC, apart from denying citizens of statutory schemes,” MC said, adding that it was urgent to issue public notice for the rebate before March 31 to invite early payments from the assessees.
UT’s local bodies department will now take up the matter with ECI to preserve the financial health of MC.
In financial year 2023-24 (till March 26), the civic body has collected ₹55.51 crore as property tax against the target of ₹80 crore.
A total of ₹36.86 crore has been collected from 18,070 commercial properties and ₹15.37 crore from 69,108 residential properties. The remaining amount was collected through arrears and garbage charges.
MC already reeling under financial crisis
The civic body is already facing a financial crisis with an almost depleted budget for FY 2023-24 and even the 2024-25 budget is awaiting approval from the UT local bodies department.
On March 19, MC officials instructed departments not to generate bills, except those of dedicated funds, till March 31 to avoid statutory liability accrued thereon. Only the committed liabilities that are salaries, pension, electricity, telephone bills, TDS and GST are being paid.
Also, the UT local bodies department has sought a report from MC on the legality of the ₹2,325-crore budget for FY 2024-25, approved during a special House meeting on March 6, under the chairmanship of mayor Kuldeep Kumar Dhalor.
Till then, UT local bodies department has allocated an interim budget of ₹300 crore for the committed liabilities for the next three months, which mainly include employees’ salaries, expenditure on garbage processing, minor works, taxes and tendered contract payments.
“With limited budget from UT, the civic body is dependent on property tax to ensure that pending bills are cleared from April onwards. In case rebate is not provided, the tax collection will be hit,” said officials.
