The Times of India 09.12.2010
Games spending and lower tax collection burn hole in MCD pocket
NEW DELHI: It seems that Municipal Corporation of Delhi (MCD) is reluctant to learn from its past mistakes. Second year in a row, the civic agency has presented a deficit budget but despite losses it has failed to draw up a concrete plan to boost its sagging revenue.
It came up with a proposal to increase property tax in residential areas but it was shot down by the political-brass which wants more people to be brought under the tax net something the civic body has been unsuccessfully planning to do for years.
The income as per the revised estimate 2010-11 is Rs 6104.70 crore as compared to a budget estimate of 7011.44 crore while the expenditure is Rs 6112.11 crore as compared to an estimate of 6872.84 crore. In fact, the proposed budget estimate for 2011-12 also reveals that the income 6247.28 crore remains lesser than the expenditure Rs 6364.43. Noting that the MCD is under a debt of Rs 2,867 crore, MCD commissioner K S Mehra on Wednesday said that there is a dire need for improving financial management and increasing revenue.
The huge expenditure incurred during the Commonwealth Games and the declining property tax collections have pushed MCD into a deep pi so much so that it has been struggling to make payments to its staff and carry out basic maintenance work. "We have also not got funds under education and health sectors from Delhi government. This non-payment has made the situation far worse,'' said an official.
Even as it battles a fund crunch, MCD is not likely to meet its target of property tax collections this financial year though this is the main source of revenue for the civic agency. MCD had expected to collect Rs 1555 crore as tax this year but is only going to manage Rs 1050 crore. "We expect to collect Rs 518 crore this year,'' said an MCD official, who claimed that a survey of properties was being carried out to get more people under the tax net.
According to Mehra, around nine lakh more people are likely to come under MCD's tax net by next year. "A survey is being carried out by the domestic breeding checkers and we are also getting data on properties from discoms. This data will be correlated with data given to us by Survey of India. There are around 30 lakh properties in Delhi out of which only 9 lakh pay tax to us. We hope to bring 9 lakh more properties under the tax net. A unique identification number is given for each property paying tax, this will further help us in our collections in the future,'' said Mehra.
Meanwhile, according to MCD, dishonoured cheques continue to be a problem. "We could not make collections worth Rs 38.26 crore because 36,362 cheques bounced,'' added an official.
While MCD's collections from advertisements have improved this year, the collections from car parking are dismal. Mehra said: "MCD has nearly finalised a new outdoor advertisement policy. It has also identified 126 new sites for unipoles and 325 new sites for wall or building wraps for advertisements and is securing revenue shares from DDA, PWD and other departments.'' The main expenses by MCD continue to be on public works engineering and sanitation.
It came up with a proposal to increase property tax in residential areas but it was shot down by the political-brass which wants more people to be brought under the tax net something the civic body has been unsuccessfully planning to do for years.
The income as per the revised estimate 2010-11 is Rs 6104.70 crore as compared to a budget estimate of 7011.44 crore while the expenditure is Rs 6112.11 crore as compared to an estimate of 6872.84 crore. In fact, the proposed budget estimate for 2011-12 also reveals that the income 6247.28 crore remains lesser than the expenditure Rs 6364.43. Noting that the MCD is under a debt of Rs 2,867 crore, MCD commissioner K S Mehra on Wednesday said that there is a dire need for improving financial management and increasing revenue.
The huge expenditure incurred during the Commonwealth Games and the declining property tax collections have pushed MCD into a deep pi so much so that it has been struggling to make payments to its staff and carry out basic maintenance work. "We have also not got funds under education and health sectors from Delhi government. This non-payment has made the situation far worse,'' said an official.
Even as it battles a fund crunch, MCD is not likely to meet its target of property tax collections this financial year though this is the main source of revenue for the civic agency. MCD had expected to collect Rs 1555 crore as tax this year but is only going to manage Rs 1050 crore. "We expect to collect Rs 518 crore this year,'' said an MCD official, who claimed that a survey of properties was being carried out to get more people under the tax net.
According to Mehra, around nine lakh more people are likely to come under MCD's tax net by next year. "A survey is being carried out by the domestic breeding checkers and we are also getting data on properties from discoms. This data will be correlated with data given to us by Survey of India. There are around 30 lakh properties in Delhi out of which only 9 lakh pay tax to us. We hope to bring 9 lakh more properties under the tax net. A unique identification number is given for each property paying tax, this will further help us in our collections in the future,'' said Mehra.
Meanwhile, according to MCD, dishonoured cheques continue to be a problem. "We could not make collections worth Rs 38.26 crore because 36,362 cheques bounced,'' added an official.
While MCD's collections from advertisements have improved this year, the collections from car parking are dismal. Mehra said: "MCD has nearly finalised a new outdoor advertisement policy. It has also identified 126 new sites for unipoles and 325 new sites for wall or building wraps for advertisements and is securing revenue shares from DDA, PWD and other departments.'' The main expenses by MCD continue to be on public works engineering and sanitation.
