Housing society clubs under tax gambit

At a time when the Municipal Corporation of Delhi (MCD) is heading for the polls, the civic body has come up with a new property tax regulation that might become a bone of discontent among the public.

At a time when the Municipal Corporation of Delhi (MCD) is heading for the polls, the civic body has come up with a new property tax regulation that might become a bone of discontent among the public.

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To fill up its empty coffers, the civic agency has decided to charge property taxes from housing societies for any commercial establishments located within the premises.

For instance, if a society has constructed a club or a recreational facility such as a gymnasium or swimming pool or even a room for a security guard, it will have to pay property tax for the same.

Earlier, the additional facilities located within housing societies were kept out of the property tax gambit.The property tax for the establishments will come to between R5,000 - R1 lakh annually and will have to be paid by the society through contributions from each flat owner.

“The housing societies earn extra income through the commercial establishments which is why the property tax is being levied on them. Flat owners will have to sort the contributions amongst themselves,” said a senior official of MCD.

“For example, if a housing society has a hundred flats, all of them will have to contribute. That way, the per annum contributions won't be much,” the senior official added.

Around 2,500-3,000 housing societies will be affected by the new order. While Dwarka has 300 housing societies, IP Extension has 117, and nearly a hundred more in Rohini, which forms the biggest housing societies in the city.

The civic body has been renewing efforts at generating more income. During 2010-11, it managed to collect Rs 1,500 crore in property tax.

The tax also includes transfer duty, which has nearly doubled. Ever since the year kicked off, the municipal corporation has not hiked property tax rates and has been looking for newer ways of generating income.