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NDMC may levy `service charge' on embassy buildings

Mandira Nayar

Panel also suggests ways to improve quality of services

NEW DELHI: The foreign embassy buildings in the heart of the Capital that were exempt from property tax under international conventions so far are now likely to be levied a "service charge" by the New Delhi Municipal Council (NDMC). This has been recommended by a five-member committee formed to examine the revenue position of NDMC, suggest ways of improving quality of services provided while maintaining its fiscal health, apart from finding an "optimum" method of assessment of property tax in the NDMC area.

The committee also suggested that the NDMC switch over to the Unit Area Method of assessment of property tax. These recommendations were put before the Council for approval and have been agreed to "in principle".

The Unit Area Method is already in use in the Municipal Corporation of Delhi (MCD) areas, but unlike the different categories that exist in these areas, the committee recommends that the whole of NDMC area be treated as one unit.

"However, the Council has recommended that this aspect be taken up for further public discussion before it is finalised," said an official. While this system promises to end "inspector raj" and will be more transparent and simple, it will also create equity. De-linking property tax from earnings, it will encourage owners to look after their buildings better.

Incentive

"This will give the owners an incentive to carry out improvements in their buildings. Owners till now often left their buildings in a dilapidated condition, so that it was perceived that they were earning less from their buildings. But now this will change and hopefully get people to start paying attention to their buildings," say officials.

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