The Hindu : Front Page : Mayors seek revision of property tax

Online edition of India's National Newspaper
Tuesday, Jun 20, 2006

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Mayors seek revision of property tax

Staff Reporter

Mayors propose a series of measures to supplement revenue

THIRUVANANTHAPURAM: Mayors representing the five city corporations in Kerala have urged the Government to take steps to widen the tax base and augment revenue sources.

Participating in a meeting convened by Local Self-Government Minister Paloli Mohammed Kutty, here on Monday they proposed a series of measures to supplement revenue. Revision of property tax was the most articulate demand. The Mayors said that absence of timely revision of property tax had deprived the urban local bodies of a major source of revenue.

They pointed out that the enactment of the Kerala Municipalities Act in 1994 had rendered corporations powerless to enhance the tax rates on their own.

The Mayors also made a fervent pitch for increasing the licence fee structure for traders and businessmen. The prevailing rate was fixed in 1984. They also demanded removal of the ceiling of Rs.2,500 on professional tax. The meeting appealed to the Government to restrict the limit up to which the building tax can be reduced on an appeal or revision petition.

According to the proposal that emerged during the discussions, the corporation secretary can reduce the tax by 10 per cent while the appeal standing committee can slash it up to 20 per cent.

The Mayors also pleaded with the Minister to reverse the previous UDF Government's decision to exempt educational institutions and hospitals from building tax. They argued that the tax exemption was unjustifiable in view of the high fee charged by the institutions. They proposed a service tax to compensate for the loss caused by tax exemption.

Highlighting the problems created by the bill system of payment introduced by the previous Government, the Mayors demanded an alternative mechanism.

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