Bruhat Bengaluru Mahanagara Palike (BBMP), Likely To Seek Permission From State Government To Collect Entertainment Tax

A discussion was held on Monday, 12 March 2018 regarding the 2018-19 budget. During the session, the Bruhat Bengaluru Mahanagara Palike (BBMP) commissioner N. Manjunath Prasad, said that according to the norms of the new GST regime, the state government cannot collect entertainment tax, but other urban local bodies can. “There are provisions for urban local bodies to collect entertainment tax. ULBs in Madhya Pradesh, Gujarat and Rajasthan have been empowered to collect entertainment tax,” he said. According to the sources, BBMP is likely to seek permission from the state government regarding the same.

Prasad also said that BBMP may also ask for a share from the state government in the revenue t gets from stamp duty and motor vehicle tax. “The council could deliberate on these issues and forward its resolution to the State government,” he said. Further giving details he added that the major source of revenue for BBMP is the property tax. He also said as per the data, around 20,000 bills were pending, which amounts to almost Rs 1,344 crore. As per the data, it is the for the first time that BBMP has identified 5000 of its properties. Prasad said that according to the records of last year BBMP had collected Rs 2103 crore from property tax and this year, until March 11, it has collected Rs 2140 crore. He further added that for more than 4,900 properties, unique property IDs have been issued. “We have also begun registering these properties and digitising all property records,” he said.

During the session, the civic commissioner also pointed out that this year service charge to be levied for union and state government which was not collected from many years was collected this year. The service charge is collected from defence establishments, railways, metro and some other sources. “We are charging around 25% service charge, and collected Rs1croresre this year,” he added. The discussions also informed that the credit rating of BBMP has improved from ‘C’ to ‘A’ for which it has been trying for past two years. Talking about the plans for this year, the civic commissioner also added that, “We will also be able to take over a couple of properties pledged for loans this year.”

“Apart from looking towards other revenue sources, it will also be prudent to have in place rules and regulations on the lines of the Karnataka Fiscal Responsibility Act, 2002, restricting the fiscal deficit for better financial stability and sustainability,” he said. He also added that the outlay this year has crossed 10K mark. The outlay for the fiscal year 2018-19 budget for Rs 9,325 crore was presented on 28 February. On Monday, during the session, a revised budget outlay of Rs 10,208 crore was passed. Earlier the BBMP had estimated to collect a revenue of Rs 4, 447 this year. After the revised passed budget out, it is now planning to collect ?5,329 crores from various sources, including property tax, improvement charges, OFC charges and building licence fees.

Pulling down on the ruling government, opposition party leader Padmanabha Reddy, after the budget was passed stated that, “Already, the list of pending works is increasing. A realistic budget would have ensured a cap on this.” This was an eyewash he added. Responding to this BBMP Commissioner N. Manjunath Prasad, putting forth the data said that compared to the budget implementation between 2011-12 and 2014-15, which was only 48%, the civic body had implemented around 75% of the budget in past two years.