Government withdraws no-tax proposal

Making yet another U-turn, Delhi’s AAP government has withdrawn its proposal to waive property tax in unauthorised colonies. In a recent advisory issued by the Delhi government to the Directorate of Local Bodies it has been stated that the government would levy tax on unauthorised colonies.

The three municipal corporations will soon levy property taxes on unauthorised colonies. According to a notification issued by the Delhi government to the commissioners of all MCDs, taxes can be levied on unauthorised colonies as against the Delhi government’s notification in 2013 putting a restraint on tax collection.

Earlier, while the Kejriwal government had issued a notification restraining the collection of taxes from unauthorised colonies, the MCD had gone against the Delhi government and proposed the collection of property taxes from these colonies. The Delhi government directed that property tax should be levied on unauthorised colonies from the date of approval of the layout plan of these colonies by the MCD. In other words, it meant that property taxes should be collected from unauthorised colonies once they were duly regularised.

“On one side the government is pressuring corporations to raise revenues while on the other it is trying to curtail rights. It is not possible to improve financial conditions without collecting property and other types of taxes from unauthorised colonies,” Lata Gupta, chairman of the standing committee of the east MCD, said. There are 243 unauthorised colonies in East MCD and 400 such colonies each in SDMC and North MCD. The Delhi government had refused to allow the MCD to collect taxes from these unauthorised colonies.