Ministers oppose proposal to hike property tax

Rajmeet Singh

Tribune News Service

Chandigarh, June 2

A proposed move by the Local Bodies Department to increase property tax and water and sewer cess to avail the increased fiscal borrowing limit seems to have run into rough weather.

The move was opposed by some ministers in the recent Cabinet meeting as increasing the rates would not be conducive at this juncture as the elections to 127 urban local bodies (ULBs) are due later this year.

Moreover, the government, in the wake of Covid-19, has extended the time limit to pay dues of property tax, water and sewer cess under the one-time settlement (OTS) scheme. The department has brought in the OTS scheme to encourage consumers to pay the principal amount in the given time, waiving the interest and penalty. Increasing the tax at this juncture would be counter-productive, ministers said.

This comes in the backdrop of CM Capt Amarinder Singh announcing to forgo the portion of fiscal deficit enhancement offered by the Centre in lieu of withdrawing free power to farmers.

Local Bodies Minister Brahm Mohindra said, “We cannot burden the common man during this tough time. When we are extending the time limit to pay the dues related to property tax, water and sewer cess, there is no sense in burdening them further.”

As part of fiscal reforms to avail the increased borrowing limit, the department has to notify the floor rates of property tax in the ULBs, in consonance with the prevailing circle rates.

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