Property tax, road digging fee, advertisement fee (to name a few) - the BBMP abounds in sources of revenue. If the extent of road-laying and construction work taking place across the city is anything to go by, the Palike should be flush with funds. No. The cash-strapped BBMP depends on the state for nearly 46% of its funding, inhibiting its ability to provide the city with infrastructure and a better quality of life. The civic body is lax about revenue collection, however, with very little accountability among its officers and illegal commercial establishments in residential zones depriving it of crores in property tax, reports Aknisree Karthik.
It’s evident to most that the BBMP is not every good at keeping the city clean and tidy. Although it is rushing to make up for lost time now by laying roads that are durable with the state assembly elections fast approaching and on the government ‘s prodding, the city has lived with pothole-filled roads for years and the garbage on the streets tells its own story.
The list of the civic agency’s ineptness, however, doesn’t end there, but extends to its revenue collection as well. While it mops up revenue in the form of service charges, advertisement taxes, trade license fee, building regulation fee and and so on, its principal source of revenue is property tax. For years it has fallen far short of its target in collecting this tax, the mainstay of its income, with many in the city getting away without paying it. It has done a little better of late , managing to mop up Rs 1,723 crore of its target of Rs 2,600 in property tax in the first six months of the year alone, the highest it has collected in five years. While linking GIS to the property tax system appears to have paid off, experts believe it can do a lot better on this front
The BBMP is also failing miserably in collecting the advertisement tax and fee due to it. Having set itself a target of mopping up Rs 82 crore from both sources it has not even reached half its target so far, going by official sources . Move on to road cutting and optical fibre cable laying and things are no better. Although it aimed to make Rs 350 crore from both, in the absence of a proper system or the needed staff it has failed to check the rampant illegal road cutting all over the city, which has robbed it of its rightful income.
Failing to generate adequate revenue of its own, the BBMP is, not surprisingly, heavily dependant on state funds for its survival. Of the Rs 9,243 crore allocated in its last annual budget, its own revenue constituted only Rs 4,252 crore.
Mr Sridhar Pabbisetty, CEO of Namma Bengaluru Foundation, believes the BBMP can do a lot better in generating revenue if it pulls up its socks and makes its officers more accountable. "The BBMP should fix accountability on its officials for their failure to collect property tax. The Standing Committee for Taxation and Finance should also be held responsible. What stops it from carrying out a thorough audit and figure out the reasons for their failure to meet their property tax targets year after year?" he demands.
The civic activist also blames rampant commercialisation of residential areas for the shortfall in BBMP’s revenue collection. “The BBMP is losing crores in revenue from the commercial activities carried out in residential areas against all norms. If it succeeds in putting a stop to this, the illegal establishments will automatically move to the commercial areas, where they should rightfully be and apply for trade licences,” he points out
Regretting that despite Bengaluru being a fast growing city, the BBMP is not able to augment its revenue through property tax, road digging fee, optical fibre laying, advertisement fee and so on, Mr Pabbisetty says this shows how rampant corruption is in the civic body and how much in cahoots the politicians and babus are.
Sadly, when an officer tries to do his job, his reward is a transfer, he laments. “Take former assistant commissioner (advertising), Mathai, who exposed a revenue loss of Rs 2,000 crore. Instead of empowering him to take action, he was handed a transfer order,” he notes with disgust, warning that unless the BBMP ups its game, it will continue to go to the state government with a begging bowl for funds to improve the city’s infrastructure.
‘Without a system in place, defaulters make hay’
“Every year the BBMP fixes a target for property tax collection and comes out with reasons for not meeting it at the end of the year. This year the target was Rs 2,600 crore. But with just two months left for the financial year to end, it has managed to collect only Rs 1,723 crore," regrets Mr D S Rajashekar, president of the Citizens' Action Forum, noting that the shortfall in collection continues despite the introduction of GIS to identify properties.
Giving an example of how poor the system in place is, he says, "I have been paying property tax regularly. I have paid it both manually and online over the years. But the other day a ward revenue officer walked up to my house and said I had not paid property tax for many years. If they do not have a proper system in place to update the tax I have paid, just imagine how easy it would be for people to get away without paying the tax!"
Pointing out that even today, while an estimated 19 lakh properties are supposed to pay property tax in the city, only 16 lakh actually do, civic activists argue that a little efficiency could help the BBMP mop up as much as Rs 7000 to Rs 8000 crore from this tax alone.
“It is the duty of the ward revenue officer to check for new buildings coming up in an area and report if any existing building has planned an expansion by building more floors. But the BBMP does not have a proper record of this kind and the officials keep mum as their hands are greased,” Mr Rajshekar charges, adding, “The BBMP will not have to resort to beating of drums, writing on the walls of the homes of tax defaulters and so on if its officials do their job.”
Palike still heavily dependent on state grants: Sapna Karim, head, civic
articipation, Janaagraha
In the first six months of the year the BBMP collected Rs 1,723 crore in property tax as against its annual target of Rs 2600 crore. This is the highest it has collected in the last five years and commendable from a revenue generation perspective.
The GIS enabled property tax system that it announced in the 2017-18 Budget was a good move. Taking steps to identify and geo-reference properties is key to ascertaining the extent of revenue the city can generate through property tax alone, its principal source of income. The civic agency has also done well in paying off pending bills to the tune of Rs 1,200 crore in the first half of the year from a capital expense budget of Rs 6,088 crore.
But it is heavily dependant on state grants with 46 per cent of its total revenue of 4,250 crore coming from the government. This heavy reliance on the state inhibits its ability to focus on providing better infrastructure and a high quality of life to the people. In fact, Bengaluru ranks at a low 19th among the 21 cities covered by the Annual Survey of India’s City Systems(ASICS) when it comes to investing in adequate funding for infrastructure and services, a direct fallout of its inability to raise more revenue of its own.
At the end of the first half of the year the BBMP still had a high residual budgeted spend on infrastructure totalling Rs 5758 crore. As many as 2,422 tenders and 2,515 job codes for an investment of Rs 1206 crore were raised in the first half of the year. While this may be less when compared to the same period the previous year, it is still a very good indication of potential projects in the pipeline.
