How BBMP arrived at steep rise in revenues

Citizen Matters asked BBMP’s finance committee to explain how it arrived at its massive revenue projections for 2010-11 The responses involve major claims.

G Manjunath Raju.

Bangalore’s city budget, presented by the BBMP at the city council session on August 30th raises more questions than answers. The steep revenue projections BBMP has cited are themselves a whole topic. Citizen Matters spoke to G Manjunath Raju, corporator of Kadu Malleswaram (Ward 65) and member of BBMP’s Taxation and Finance committee that prepared the budget. Discussion on the budget at the council is scheduled for September 2nd.

There is a several fold increase in revenues compared to last year. How are you planning to manage that?

There are total 15 lakh properties in the city. Last year itself there was a collection deficit, that will be overcome as new areas are added. Of the 10.41 lakh properties that were under the tax net last year, around 30% were defaulters. This, along with the new 4.59 lakh properties that were identified by the GIS (Geographic Information System) last year, will contribute revenue. So almost 50% of the total properties that were left out, will come under the tax net this year only. The arrears from last year itself will be a huge amount.

Are you making any specific plans for this implementation this year?

This year plans are very specific. We have a very aggressive Commissioner (H Siddaiah) along with the Tax Committee Chairman (P M Sadashiva). There will be a drive by our department. In tax collection, much corruption does not occur. We have proposed having more number of tax collectors and stringent penalty for defaulters. It is a huge collective task. I am sure the commissioner and mayor are making plans for this.

What about the increase in revenues from trade license fees from Rs 9 crore to Rs 107 crores?

In the case of trade licenses, only 40,000 trade licenses have been issued while there are 4 lakh traders in the city. These numbers were also identified through GIS recently. Many people involved in commercial activity are paying residential taxes.

P M Sadashiva intervened at this point to explain that trade license fee will be doubled soon, which will contribute to the  increase in revenue.

Discussions about increasing license fee will come up once the other standing committees are formed. It will take about 15 days. The traders won’t mind paying and nobody will care to talk about it.

What about the huge leap in advertisement revenue from Rs 17 to Rs 100 crores?

We will auction advertisements in commercial areas. Advertisements will have to be registered with us. According to this register, we will set up auctions. Lot of international advertisements are coming to Bangalore. There is more machinery – more officials to ensure efficiency.

On what basis were these numbers arrived at?

The rates for advertising have been changed. So a base rate has been fixed and will go for auction. There will be more number of ads as new areas are also added.

How did you arrive at the improvement charges of Rs 120 crores?

Lot of new BBMP areas are not developed. The housing layouts come under BDA, but we levy the developmental charges. Many areas have been identified for this. If you go in Hosur Road direction, you will see lot of developed areas on the sides of the highway itself, not interiors. Housing requirement is there. Old Bangalore was around 220 sq km, today it is 800 sq km. Last year improvement charges were not levied.

Regarding Sakrama, you have projected Rs 750 crores. How?

Rs 750 crores is a very very pessimistic number, we have expected more. But people will say that the budget itself is based on sakrama, so we gave a smaller number. The break up of Sakrama is in the public domain itself. I think this time the bill will be passed. Even if Sakrama Bill is passed three months before the end of the financial year, the collection will be more than Rs 750 crores.

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