Gurugram development body plans 10% cess on property registrations

GURUGRAM: The Gurugram Metropolitan Development Authority (GMDA) has offered a slew of revenue generation measures due to the absence of any fixed source of income. This thing is proposed to make itself financially self-reliant. Besides that these put up measures for the chief minister’s approval includes a 10% cess on property registrations and a 5% cess on new vehicle registrations in the urban areas under GMDA’s jurisdiction.

Officials stated that the proposed 10% cess will be charged according to the value of the property. According to the GMDA officials, Section 42 (1) of the GMDA Act allows the state government on the recommendation of the authority to levy a cess on property or vehicles. According to the copy of the official agenda accessed by TOI “As per the Act, this amount shall be collected by the MCG/ULB (urban local bodies) for onward remittance to GMDA”.

 “As per the figures presented in the meeting, GMDA is facing a loss of around Rs 300 crore. We are looking at alternative revenue generation measures so that the authority can take up more development projects,” said Khattar during the media interaction after the meeting on Tuesday

In addition to the property cess, a new proposal for cess on registration of new vehicles has also been proposed to the chief minister. The meeting agenda also said “It is proposed that a cess of 5% may be levied on the registration of new vehicles in the GMDA area. Also, at least 50% of road tax collected by the transport department from the GMDA notified area should be remitted annually to GMDA for road infrastructure work. The metropolitan authority has started leasing land to liquor vends already. This step has generated substantial revenue for this financial year. It has also proposed that GMDA’s assets like parts of green belts may be leased for other uses like petrol pumps, nurseries, and conforming uses.

Since the formation of the metropolitan authority, the plan for the levy of cess on property and vehicles had been in the pipeline.

GMDA was not in the favor of levying these taxes until it had done substantial development work to justify these taxes in the city. However the extent of development done by GMDA is debatable, the metropolitan authority is in urgent need of funds.

Efforts to find revenue-generating sources are made in the past as well. It was regarded to the fact that the chief minister had approved the stamp duty charges be split between MCG and GMDA at 1% each last year. Earlier the entire 2% stamp duty charges went to MCG. While MCG councilors, including the Mayor, had objected to the proposal, the CM had approved it at a GMDA meeting last year.

Apparently, the ULB department had rejected the proposal. But Khattar had persisted on the proposal “even if it requires an amendment to the urban local bodies act”.