Haryana government withdraws proposal to levy cess on property registration

GURUGRAM: The state government has withdrawn the proposal to levy cess on property tax and on sale of new vehicles as a revenue generation source for the Gurugram Metropolitan Development Authority (GMDA). This decision was finalised last month, said GMDA officials as per directions from the state government.

According to the officials, in view of the decisions taken in the matter of sharing of stamp duty and transfer of EDC funds to GMDA, the proposal was withdrawn. Regarding the proposal to levy a cess on the registration of vehicles in the city, the chief minister’s office said that there was no provision in GMDA Act, 2017, to impose a levy on vehicles and hence there was no need to consider any such proposal.

GMDA chief Sudhir Rajpal when approached on the subject said, “These are revenue sources for GMDA but ultimately the state government takes the decision. Any such cess would add additional burden on the residents and hence the government has decided to not take these charges,” Rajpal said.

TOI had earlier reported that chief minister Manohar Lal Khattar had in principle approved a bunch of revenue generation measures in a bid to make the metropolitan authority financially self-reliant.

Besides the cess on property, a proposal for cess on registration of new vehicles had also been approved by the chief minister earlier. It was proposed that a cess of 5% may be levied on the registration of new vehicles in the GMDA area. Also, at least 50% of the amount of Road Tax collected by the transport department from the GMDA notified area should be remitted annually to the authority for road infrastructure work in the notified area.

The measures had been proposed to generate funds for GMDA’s infrastructure work as the agency was seeing a big gap between its expenditure and revenue. With the EDC funds now being transferred straight to GMDA, officials are hopeful of a better revenue stream.

However, even with the 1% stamp duty charges and EDC funds, the financial troubles for the metropolitan authority are far from over. The budget for the year 2021-22 has been estimated at Rs 1,848 crore whereas the expected receipts for the year are around Rs 1,200 crore. “There is a shortfall of around Rs 600 crore and we are looking for avenues for financing the gap amount,” said Khattar, while talking to mediapersons after the meeting.