The Times of India              12.10.2010

GHMC eyes RTA vehicle tax

HYDERABAD: With maintenance and laying of roads becoming a major financial burden, the cash-strapped Greater Hyderabad Municipal Corporation (GHMC) is eying a pie in the Rs 500 crore life tax being collected by the Regional Transport Authority (RTA).

The corporation has sought Rs 350 crore every year as its share from the nearly Rs 500 crore revenue earned by RTA in the form of vehicle tax.

Corporators have begun efforts to ensure GHMC gets its due share in the vehicle tax and decided to pass a resolution in the forthcoming council meeting.

Also, GHMC commissioner Sameer Sharma has written a letter to the principal secretary, Municipal Administration and Urban Development (MA&UD) department, recently seeking directions to tap those funds.

GHMC officials claimed as per the Hyderabad Municipal Corporation (HMC) Act, 1955, and Rules 1965, the civic body has the right to collect tax on vehicles, animals and boards. However, for the past few decades, the RTA has been collecting tax on the directions of the state government and paying only Rs 60 lakh per annum to the corporation towards its share.

In 2009-fiscal, the RTA had collected Rs 500 crore towards vehicle tax and other charges, but it paid only Rs 60 lakh and that too in four quarters, the officials said.

"When the amount was fixed in the late 80s, the civic body's jurisdiction was limited and road maintenance expenditure was meagre. Now, the regular maintenance expenditure (repairs) of roads has increased to Rs 250 crore every year and another Rs 100 crore is being spent on road laying and formation," an engineering official said.

The GHMC has also lined up several projects worth Rs 790 crore for the next five years, which includes upgrading road infrastructure facilities of 44 roads at an estimated cost of Rs 500 crore (Rs 100 crore per year), road widening works worth Rs 40 crore every year for the next five years, and road making and traffic signals worth Rs 90 crore (Rs 18 crore per year).

For taking up the special project related to roads, the GHMC has to spend Rs 158 crore every year, the commissioner said in the letter.

The GHMC has also sent a detailed note on the financial condition saying that revenue surplus of the corporation in the last financial year was just Rs 195.42 crore which cannot be used for all the development works. The corporation had already availed Rs 500 crore overdraft from banks.

When contacted, GHMC additional commissioner (Finance) S Hari Krishna admitted that a letter was sent to the state government recently for enhancement of vehicle tax. "Last year, the late chief minister YS Rajasekhara Reddy had directed RTA for enhancement of the vehicle tax share to Rs 158 crore during a review meeting, but it was not implemented," he said.