Corporation of Chennai off tax target, infra spend may be hit
Jan 14, 2014
Source : The Times of India


CHENNAI: Cash-strapped Corporation of Chennai doesn't have the funds to pay the salaries of contract workers but it is set to fall short of its property tax revenue target for a second successive year.

This year is likely to be much worse than the last, with the civic body collecting only 302 crore of its targeted 550 crore till January 9 for the fiscal 2013-2014 — a shortfall of 248 crore. It fell short of its target of 500 crore in 2012-2013 by 39 crore.

Because property tax is the corporation's main source of revenue, officials say a defict is likely to adversely impact various infrastructure projects like the setting up of bus shelters, construction and maintenance of public toilets, the laying of new roads, garbage clearance and payment of wages and arrears of employees of the civic body. The corporation's dog catchers went on strike recently over not being paid salaries for more than two months.

The city has among the lowest property tax rates in metros in the country because the corporation has failed to revise the tax structure since 1998, despite a law stipulating that it be revised once every five years.

The corporation collects property tax twice a year, by April 15 and October 15. But only 60% of people pay on time.

Officials are pinning hopes on last-minute payments to enhance the collection this fiscal. "We expect to collect larger amounts of the tax in February and March because most people pay taxes only in the last two months of the financial year," a senior corporation official said. "But it is definitely going to be difficult to meet the target of 550 crore this year."

Tax collectors receive 78% of property tax payments and zonal collection centres 16%. Around 4% is paid online and just 2% of residents pay through banks. Officials say shortage of staff has affected tax collection this year.

"More than 273 tax collectors in 15 zones receive tax payments for around 13 lakh properties. We will soon procure 300 new handheld devices to streamline the process and help increase the collection," the official said.

Another reason for the low revenue is that the civic body does not have the power to penalise or fine property owners for late payments or failure to pay the tax. Officials said they had proposed that taxpayers who fail to make payments within the half-yearly deadlines be fined 2% of the sum they are required to pay as property tax.

The corporation is also wary of naming property tax defaulters in the city, as TOI reported recently. Several large establishments in the city including hotels, shopping malls and hospitals owe the civic body crores of rupees in unpaid property tax.

Latest Realty News

A high road story of Chennai
Jan 13, 2014
CHENNAI: The Poonamallee High Road, or EVR Periyar Salai, stretches east-west, almost from one end of the city to the other. It is one of the longest, broadest and oldest roads in our part of the country. It has been named after the historic village of Poonamallee mainly because it was initially meant to connect many areas within the city to this village. According to scholars, the name Poonamallee is derived from the Tamil term Poo Virunda Malli (Arabian jasmine) alluding to the profuse cultiva
70,000 apply for 248 CMDA subsidised plots
Jan 13, 2014
CHENNAI: Applicants thronged the CMDA office at Egmore as the last day for registration for CMDA-approved plots came to an end on Monday.
Chennai coastline to get snazzy with govt realty project
Jan 13, 2014
CHENNAI: Foreshore Estate off Marina may turn into a swank esplanade with the state government planning to build 560 high-end apartments on the sea-front.
Sales volume in real estate sector in Chennai declines: Study
Jan 10, 2014
CHENNAI: Sales volume in the real estate sector in the city during the last one year witnessed a 33 per cent decline owing to the impact of global slowdown due to high inflation and negative buyer sentiments, research firm Knight Frank said today.
Housing sales down 33% in Chennai in 2013; prices up 5-7%
Jan 10, 2014
CHENNAI: Sales volume in the real estate sector in the city during the last one year witnessed a 33 per cent decline owing to the impact of global slowdown due to high inflation and negative buyer sentiments, research firm Knight Frank said today.
Ceebros drops prices in premium areas of Chennai
Jan 10, 2014
CHENNAI: In a move that is bound to shake up the realty market in the city, leading builder Ceebros has dropped prices for residential projects in the upmarket Nungambakkam, T Nagar and Poonamallee High Road areas. The disruptive strategy, it says, is only to ensure that it is not saddled with unsold stock at a time when the market is very sluggish.
PE exits in real estate rose by 33% in 2013
Jan 09, 2014
CHENNAI: Private equity (PE) firms focused on the real estate sector made 24 exits during 2013 compared to a total of 18 exits announced during 2012. Ten of these exits with disclosed values harvested $421 million for the investors.
Indian Bank, Indian Overseas Bank launch special drive for home loans
Jan 08, 2014
CHENNAI: In an attempt to target prospective home buyers, public sector lenders -- Indian Bank and Indian Overseas Bank -- are offering home loans at interest rates of 10.20 and 10.25 per cent, respectively.
Realty: Then and now
Jan 04, 2014
CHANNAI: The economic downturn in the year 2013 has had an adverse impact on various sectors and the realty sector has not been insulated by these changes. The year has been one of guarded optimism and the sentiments were rather cautious from both investors and builders.
Owners rent out buildings to commercial units, cheat on tax
Jan 03, 2014
CHENNAI: A growing number of residential properties in the city are being used for commercial purposes to evade high property tax resulting in a huge loss to the city corporation. Any shortfall in collection of property tax, the biggest source of revenue for the corporation, impacts infrastructure schemes directly.

Latest Realty News Of State

Realty Talk's