CHENNAI: Defending the DMK government’s decision to hike property tax, Municipal Administration Minister KN Nehru said the exercise was not indiscriminate as was done by the AIADMK in 2018 and was implemented under a slab system to save economically-backward families from the impact. Excerpts:
What was the focus of Municipal Administration and Water Supplies Department last year? What is it going to be for the next four years?
About 55% of Tamil Nadu’s population resides in urban areas. Based on Chief Minister MK Stalin’s instructions, we are working towards addressing the basic needs of this population. Improving sewage, toilets, stormwater drain facilities and conversion of earthen roads to bitumen, paver blocks or cement roads are among our main areas of focus. Last year, around Rs 1,000 crores was allocated for this Rs 550 crore for corporations and municipalities and Rs 450 crore for town panchayats. Orders have been issued and work is in progress. This year, the CM has allocated another Rs 1,000 crore to take this work forward.
The DMK was not in favour of revision of property taxes when the AIADMK government attempted it in 2018. What has changed since then and what drove you to the decision now?
The first thing that the CM told us is that the revision should not be done in a way that would affect economically-backward families. The revision was done as per the 15th Finance Commission recommendation according to which property tax must be mandatorily revised to get Central grants from the year 2022-23. When the AIADMK introduced the revision in 2018, it was done indiscriminately and was later revoked due to elections. We came up with a slab system that suggested a 25% to 50% hike for houses below 600 square feet, 50% to 75% for those from 600 to 1,200 square feet, 75% to 100% for houses from 1,200 to 1,800 square feet, and 100% to 150% for houses above 1,800 square feet, and 100% hike for commercial establishments. Due to maintenance issues involved in the upkeep of empty sites, including steps against mosquito breeding, we had decided to hike tax 200% hike. Based on the CM’s instructions, we formulated the revision in a way that would not hurt economically-backward sections and people have accepted it.
What will this revision bring the people?
Through this hike, town panchayats and municipalities that have long been inactive and were cash strapped even to disburse salaries will have the autonomy to carry out development work. The tax revision will help them in addressing issues of water stagnation, construct and maintain toilets, convert street lights to LED and repair water supply pipelines, etc.
Although property tax has been revised, there seems to be a gap between demand and collection of tax?
We are encouraging officials to work harder and improve collection without troubling people. Steps will be taken to recover pending dues from large corporations. The process will be carried out step by step.
Release of basic and performance grants to urban local bodies from the Centre has been pending. Has there been progress?
We expect to get Central grant dues of Rs 7,000 crore for last year and Rs 15,000 crore for this year shortly.