Low property tax tops PM’s agenda for Niti Aayog meet

Given the level of resources that the municipal bodies generate, it is no surprise that they find themselves with little funds to meet their developmental needs, an issue that is going to be deliberated in detail at the Niti Aayog governing council meeting on Sunday.

The agenda for the meeting, to be chaired by PM Narendra Modi, has pointed to the dismal revenue of civic bodies and suggested an overhaul, by linking property tax to electricity bills. In fact, the agenda flows from a recent meeting that the PM had with state chief secretaries. A packet of trash bags costs around Rs 50 on an ecommerce site, almost twice the per capita property tax in a city like Kota (Rs 28) and one-third the level in Amritsar (Rs 150) in 2017-18.

Mumbai, which is at the top, had a per capita mop up of a little over Rs 4,000, but the average for India is just Rs 688 — the cost of a 5kg bag of basmati rice.

Collection of property tax is one of the major sources of municipalities’ own revenue and the municipal bodies often hesitate to increase property tax due to political considerations. The meeting’s agenda will also suggest that municipal bodies be tasked with collecting professional tax instead of states.

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