The Tamil Nadu government has announced effecting an across-the-board revision in property tax to mop up revenue for local bodies, proposing up to a 150% increase, but asserted the rates were lesser than many other states. The main opposition AIADMK lashed out at the move and said this was only a "trailer" and that more "bumper prizes were in store" for the people for electing its rival, the DMK, in the elections. DMK ally Congress also opposed the move, saying it would further burden the people in the wake of the rising fuel prices and called for a re-think on the mode of its implementation.
Municipal Administration Minister KN Nehru told reporters in New Delhi the tax revision was effected in line with the 15th Finance Commission guidelines and that Central funds would be made available only if it was done, he claimed. According to an official release, a number of reasons, including a manifold increase in inflation over the years, spurred the decision to effect the increase and there was a dip in the civic bodies' share of their own revenue. To implement the property tax revision, four slabs to determine the area of the property had been determined.
In Chennai, the property tax revision for residential buildings in the core area was 50% for those below 600 sq ft, 75% for 600-1,200 sq ft and 100% for 1,201-1,800 sq ft, the government release said. The rate has been revised to 150% for those above 1,801 sq ft. Rates have been revised in areas coming under other civic bodies including municipalities while the same is the case with commercial structures and buildings housing educational institutions.
Leader of Opposition in the state Assembly, K Palaniswami, lashed out at the DMK government for effecting a hike in the property tax. He said that the DMK government which "refused to give the Pongal special (cash) assistance to people as a reward for choosing it in the Assembly polls, has now gifted them with a 150% property tax hike for electing the party in the (recent) civic polls."
"This property tax hike is just a trailer. In the coming days, more bumper prizes are in store for the people," the AIADMK joint coordinator, also the former chief minister, said in a series of tweets.
Hitting back at Palaniswami, Nehru said the previous AIADMK government had earlier proposed a 200% hike for all sections but held it back with an eye on the polls.
"However, chief minister (M K Stalin) is keen to ensure the poor don't suffer," and therefore a slab system has been put in place. Most common people come in the lesser tax brackets and would therefore be not impacted much, he claimed.
The revision was still less compared to other cities like Bengaluru, Lucknow, Indore, Ahmedabad, Mumbai and Kolkata, he said. The increase was in line with the Central directions and would apply to all states, Nehru added. The tax was being revised after 24 years, he said in response to a question.
"This revision is being effected considering the price rise, salary hike for employees and the additional expensed incurred towards strengthening the basic infrastructure of civic bodies and the need to address people's basic needs," the release added.
Meanwhile, state Congress chief KS Alagiri said the tax revision would "severely impact" all sections of the society.
"This announcement must have been made without it coming to the attention of the chief minister," he said in a statement, adding that the hike would only further burden the commoners suffering from the daily hike in the prices of petroleum products. "Therefore, I request the chief minister that rather than implementing it at one go, it should be reconsidered for a 10% annual hike," he said.