Pune: The Pune Municipal Corporation's (PMC) Standing Committee on Thursday rejected the civic administration's proposal to increase property tax by 15 per cent in the 2018-19 civic budget.
Municipal Commissioner Kunal Kumar had proposed a 15 per cent hike in the annual budget, which could generate Rs 135 crore more revenue. Addressing the media, Standing Committee Chairman Murlidhar Mohol said, "We have rejected the proposal of the municipal administration to hike property tax for 2018-19. The reason is that the administration has failed to collect tax dues in the current year. There are around Rs 2,400 crore arrears yet to be deposited in the corporation's coffers. Of these, the penalty amount is valued at around Rs 1,200 crore. We have set a target to increase the collection instead of putting more burden on citizens."
He however admitted that there is more pressure on the civic administration to generate revenue. He said, "The administration will have to find alternate revenue sources besides property tax." The Standing Committee has suggested setting up a special cell for the recovery of arrears with sufficient staff. Due to a lack of manpower, the civic body is not able to recover tax. If the property tax department recovers arrears on a regular basis, there is no need to hike tax, Mohol said.
Kumar recently tabled the civic budget estimated to be of Rs 5,397 crore, considering the 15 per cent hike in the property tax. He had factored in Rs 135 crore from the property tax hike.
Kumar has already cut the civic budget by Rs 200 crore as compared to last year's budget. Since the Standing Committee rejected the property tax hike, the budget has reduced by Rs 135 crore.