An aerial view of Bhubaneswar. Telegraph picture

Bhubaneswar, April 3: Encouraged by an increase of nearly Rs 8 crore in holding tax collection this year compared to the last fiscal, Bhubaneswar Municipal Corporation (BMC) now plans to restructure its tax collection mechanism. The corporation is now likely to have separate teams for assessment and collection of tax. The civic body hopes to rope in crores more with this new plan.

Sources said the last fiscal holding tax collection was Rs 12.88 crore. This time it is Rs 20.5 core. Earlier, both assessment and collection were looked after by tax collectors. But from this financial year, the assessment team will have structural engineers along with tax officials for better assessment. Without the presence of structural engineer, no tax collector can take the measurements of a building.

“The civic body has noticed that the collectors are not assessing the holdings properly. If there are multiple members, the assessment process will be foolproof and more acceptable as all the team members will have to give their approval for the measurement,” said a senior BMC official.

Sources in the BMC said that there were 80,000 holdings under the tax net. But 44,000 still fall outside it. According to the new plan, the civic body hopes to collect nearly Rs 50 core or more in the coming financial year.

“In reality, holding tax collection starts towards the last three months of a financial year, but this year we will start it from the beginning i.e. May, so that new holdings will be included to the existing ones. With the capital city growing rapidly, holdings are being adding to the city on daily basis. New holdings are also to be added to the existing tax net,” said deputy municipal commissioner Priyadarshi Mohapatra.

The two teams looking after holding tax will have to facilitate correct assessment according to the size and use of the building as now the tax is based on two factors — whether the structure is used for residential or rental purpose. Holding tax is collected as per a notification issued under the supplementary provisions of the Orissa Municipal Corporation Act, 2003.

“There is some miscommunication regarding rate and calculation of the holding tax collection but people are coming up in great numbers to declare the value of their holdings under the voluntary declaration scheme. But certainly, more than 60 per cent of the holdings are not assessed properly. They need a revision. In this case, we follow Section 137 of the Orissa Municipal Act, 1950. And there is no question of new tax,” explained Mohapatra.

Not only household holdings, more than 250 government holdings have never been reassessed in the last 30 years.

“As alterations were made to all the buildings, a reassessment will fetch the civic body some more crores. Resident welfare associations are supporting our efforts as they believe that tax collected from holdings would be spent on development activities,” added another official.

Councillor of ward No. 37 Padmanabh Dash, however, disagrees. “The city has grown in a multi-dimensional manner, but tax officials are only targeting areas like Gautam Nagar, Buddha Nagar, Bapuji Nagar, Ashok Nagar, Satya Nagar and Sahid Nagar. There will be more than 1.5 lakh holdings to be included in the tax net and not 44,000 as BMC says. So tax officials should concentrate more on including more holdings in the tax net,” he said.

The councillor, who was the chief convener of the Bhubaneswar Holding Taxpayers Working Committee in 2006-’07, added that while the civic authorities were harping on reassessment of the individual houses, big players and educational institutions, including private universities, are not depositing tax according to rules and not even cooperating with tax collectors.

“Educational institutions, commercial complexes and even housing projects have come up in industrial areas deviating from the original plan. Why have they not been included in the tax net is yet to be cleared. Villages in the BMC area were never calculated as part of the holding tax net. The officials are still unable to assess those houses as per the new notification,” he said.