CHENNAI: To strengthen Tamil Nadu’s non-tax revenues, the State government is looking to revise development charges, open space reservation area charges and centage charges. A high-level meeting is scheduled this week wherein new rates may be announced. The move could boost the State’s coffers. The additional revenue earned could be over Rs 100 crore per year.
The State had estimated that it would generate Rs 13,327 crore (seven per cent of revenue receipts) through non-tax sources this financial year. Non - tax sources include interest receipts, dividends, and royalties, among others. It is learnt that this is a decrease of 9.3 per cent over the 2018- 19 revised estimate, which is expected to grow by Rs 3,399 crore compared to the budgeted estimate — 30 per cent increase.
Official sources said that since the last 13 years, OSR area charges, development charges, centage charges for plots and partition of land charges have not been revised. The idea is to strengthen the non-tax revenue base and augment resources. Currently the centage charge is `300 per plot. This is likely to be increased to `1,000, say sources.
TN plans to boost non-tax revenue
Similarly, charges for partition of land, which is now being charged Rs 6,500 per application may be increased to Rs 10,000. This could increase the additional revenue per annum for government to Rs 5.50 crore. OSR area charges lesser than 2,500 sq.metres per site, wherein the charges are nil. For the site which is greater than 2,500 sq.metres, the charges is 10 per cent of the land value, likely to be evaluated on two times the guideline value of the land.
This is likely to enhance the State’s coffers by Rs 15 crore to Rs 20 crore per month. Meanwhile, the development charges which was at maximum Rs 25 per sq.metre and Rs 0 per sq. metre for land and building respectively are likely to be increased. As per the proposal, the minimum charges for land is fixed at Rs 50 per sq. metre and maximum as Rs 250 per sq. metre. Similarly for buildings, the minimum is Rs 100 per sq. metre and maximum is Rs 500 per sq. metre.
Ajit Chordia, former president of Confederation of Real Estate Developers Association of India and managing director of Olympia Group, told Express that any move to increase non-tax revenue by increasing development charges will be a retrograde step. “When the real estate is looking for stimuli, the move will be anti-stimuli and will have impact on real estate sector,”he said.
