Delhi: 5% of ward tax collection to be reserved for EDMC local development fund

he tax and fee collection to be considered under this scheme include property tax, general trade license, health trade license, veterinary license and factory license

In a bid to incentivise tax collections and increase its revenue, the East Delhi Municipal Corporation (EDMC) will allocate 5% of property taxes and license fee collected from each ward to its local area development (LAD) fund.

A senior EDMC official said that cap of ₹50 lakh has been fixed on the councillor LAD fund (Sourced)

A senior EDMC official said that cap of ₹50 lakh has been fixed on this councillor LAD fund. The tax and fee collection to be considered under this scheme include property tax, general trade license, health trade license, veterinary license and factory license.

The civic body’s jurisdiction is divided into 64 municipal wards, split into two administrative zones — Shahdara North and Shahdara South.

East Delhi municipal commissioner Vikas Anand said that to implement this scheme, a councillor-wise record of an area’s development work will be maintained.

“The councillor of the area concerned must ensure that the development work is necessary and cannot be postponed. Payments will be released depending on the availability of funds,” he said.

“While undertaking development work, the councillor will ensure that financial discipline and prudence are followed,” Anand added.

EDMC mayor Shyam Sunder Aggarwal said that the civic body has not been able to provide any LAD funds due to financial constraints, except for one annual cycle in the past five years, when councillors were given ₹30 lakh each. He, however, said he was not entirely in support of the policy

“The idea behind the scheme may be to push councillors to improve tax collections in their areas, but it will also lead to disparity between rich and poor areas. Shahdara South is relatively more affluent, with developed commercial areas and tax collections will be higher. I am in favour of increasing tax collections, but an economically backward area should not be penalised to achieve that goal,” Aggarwal said.

Resident welfare groups welcomed the idea, but urged that a monitoring mechanism involving local citizens be put in place.

BS Vohra who heads the East Delhi RWA Joint Front said that that the record of collections from an area and its utilisation should be made public.

“It is public money and should be used for public welfare. But the 5% quantum is too little and should be raised. For instance, the construction of a mid-sized inner colony lane alone takes ₹7-8 lakh,” Vohra said.

Atul Goel, who heads URJA, an umbrella body of resident welfare groups, said ward consultative committees involving RWAs should be formed to prioritise work to be undertaken using such a fund. “Basic parity between wards should be ensured, as some wards will have higher tax collections due to commercialisation and dense population. These areas will also need more development work due to a larger number of users,” he added.