Note ban nets a windfall for civic bodies

NEW DELHI: Municipalities in Haryana recorded maximum increase (over five times) in collection of property tax and other user charges in November, following demonetisation of Rs 500 and Rs 1,000 notes, as compared to the amount they collected during the same month last year.
Municipal bodies in Telangana, Maharashtra, Gujarat and Chhattisgarh recorded a spurt in such income, according an analysis of revenue rise across 450 municipalities in India.Chandigarh, Goa and Himachal Pradesh saw a slight dip in collection.
These municipalities are covered under the Atal Mission for Rejuvenation and Urban Transformation (AMRUT).

According to data, Narkatiaganj municipal body in Bihar recorded the highest increase by 101 times, though the amount collected was negligible. Gudur municipality in Andhra registered the second highest increase by 40 times.
The data showed that while overall tax collection and other user charges across these municipal bodies was Rs 1,034.5 crore during November 2015, it rose to Rs 3,555.7 crore last month, registering nearly 2.5 times increase. The spurt in such revenue was primarily because of the government’s decision to allow Rs 500 and Rs 1,000 notes for making payments to municipal bodies.
Last month, the urban development ministry had said the total revenue of 47 select civic bodies had reached Rs 13,192 crore against a collection of just Rs 3,607 crore a year back.
“That figure included all types of revenue collected by the selected municipal bodies including non-tax revenue. But in the case of these 450 cities, we have taken collection of only property tax and other user charges such as water bill and sewage charges,” an official of the urban development ministry said.
He added that the analysis of data from these 450 municipalities shows how almost every municipal body saw increase in collection of property tax.