KOCHI: In a major move to bring down the controversial tax hike in the city, the Kochi Corporation has unanimously decided to cancel property tax collection on the basis of recently introduced user-defined plinth area system.
To implement the decision, the council, which met on Thursday, cancelled last year’s decision that changed the tax collection mechanism from the earlier ARV system to plinth area.
“There is unanimous discontent on the new tax system as it has resulted in exorbitant hikes. The corporation council, therefore, is cancelling its earlier decision of the user-defined plinth aream system. In addition, the corporation finance committee will carry out a thorough review of the new regime, collecting inputs from financial experts, and will come up with a report pin-pointing all fall-outs. Further decisions will be made after viewing the report,” said Mayor Tony Chammany in the council meeting on Thursday.
The new tax collection mechanism (user-defined plinth area) was introduced after a 2013 Government Order (GO) and had caused a series of protests, both public and political.
The corporation had written to the state government for more clarification on the GO. It was also a burning issue in the last two council meetings of the local body and had stalled the council proceedings.
The civic body had temporarily suspended tax collection last month following stiff criticism. The decision, however, will call for a revision of the new tax system, reports said.
Mayor Tony Chammany said that three major discrepancies have been found in the new mechanism. “According to the new regime, a hike of Rs 20-80 per square metre was imposed on buildings.
If the government allows, the upper limit of the tax rates will be brought down. An additional 25 percent hike had also been imposed squarely as default from all tax payers which would ultimately swell into a large amount. In view of all these, the finance committee has been assigned to make a report pin-pointing all such issues,” said the Mayor.
Nonetheless, the corporation’s decision to annul the new tax regime has come after many tax payers have paid taxes based on the renewed system.
However, the additional amount collected will not be returned but would be adjusted in the next payment after inspections, said the Mayor.