The Hindu 26.11.2010
Agency told to collect ad tax, but with a rider
| Asked to cough up 30 crore as bank guarantee to collect tax from signboards on behalf of GHMC |
Lot of complaints pour into GHMC head office alleging ‘harassment' by the agency personnel
USM Business Systems has assured Rs. 10 crore, Rs. 12.5 crore and Rs. 15 crore as payments
HYDERABAD: Greater Hyderabad Municipal Corporation (GHMC)'s ongoing saga with USM Business Systems, the private agency chosen to collect advertisement tax from signboards, is still on.
Bank guarantee
A fresh move is on to let the agency collect the tax but with a rider. It being asked to cough up Rs. 30 crore as bank guarantee as payment for the remaining two years period to collect the ad tax from signboards on behalf of GHMC as was directed by the High Court.
But, the agency has only four months left of the three-year contract to collect the tax amounts from an estimated 1.5 lakh signboards as the period ends by March next. Ever since ad tax collection was outsourced to the agency, there have been vehement protests by traders over the method of collection.
Lot of complaints began to pour into GHMC head office alleging ‘harassment' by the agency personnel. Even as the municipal corporation decided to annul the contract and even sent a notice, USM as well as traders approached the HC for different reasons. HC while entrusting the tax collection job to GHMC had also asked it to follow due procedures to cancel a contract.
It gave ground for the agency to seek permission to collect the tax on the civic body's behalf for the remaining period.
Frontage arches
Tax was being collected for frontage arches, brand names, mobile ads, boards, umbrellas, pole panels, banners, etc., at the rate of Rs. 1,200 per square metre and Rs. 600 per sq.metre for vinyl boards.
USM has assured Rs. 10 crore, Rs. 12.5 crore and Rs. 15 crore as payments. It also paid up Rs. 6 crore and another Rs. 4 crore in bank guarantee in the first year.
A three member panel of Additional Commissioners of Planning, Finance and Advertisements are finalising the details of the fresh agreement to be put in place in case the agency consents.
