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Bengaluru Budget: Unlocking revenue potential

There is a call to include professional tax, entertainment tax and luxury tax -the city generates over Rs.1,000 crore -in the BBMP tax net.

, ET Bureau|
Updated: Mar 21, 2017, 01.46 PM IST
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Data point out that the BBMP can mop up over Rs.8,000 cr,  more than three times the figure of Rs.2,591 cr that CM Siddaramaiah has budgeted for the city in 2017-2018.
Data point out that the BBMP can mop up over Rs.8,000 cr, more than three times the figure of Rs.2,591 cr that CM Siddaramaiah has budgeted for the city in 2017-2018.
BENGALURU: The civic administration of India's IT capital promised half a dozen projects in its previous budget. With expenditure outdoing revenues, the announcements have remained on paper.

There is a huge untapped potential of revenue waiting to be unlocked. Data point out that the Bruhat Bengaluru Mahanagara Palike (BBMP) can mop up over Rs.8,000 crore, more than three times the figure of Rs.2,591 crore that Chief Minister Siddaramaiah has budgeted for the city in 2017-2018.

Sample this: The BBMP earns Rs.49,701 annually from fifty acres of land it has leased out in some of the city's most affluent locations. In fact, of the 409 estates for which BBMP has data, 247 pay less than a lakh as annual lease, including 130 that pay less than Rs.1,000. This includes the posh Indiranagar Club, which will pay an annual sum of Rs.500 till its 40-year lease period ends in four years.

Bengaluru Budget: Unlocking revenue potential

The Public Utility Building on MG Road, for instance, generates Rs.6.66 crore in rental earnings, over half of the total earnings from all its markets. An additional Rs.7.75 crore can be generated based on Rs.100 per sqft rental on MG Road, according to realty consultancy JLL.



Also Read: 86% of BBMP budget was used to pay old bills



“There are some cases pending before court. We're trying to bring them out of court so we can revise lease and rents,“ BBMP Taxation and Finance Committee chairperson MK Gunashekar said.“However, it depends on the terms and conditions of the agreements. We can, and will, act if there are violations like sub-leasing.“

Municipal assets are categorised as estates when BBMP owns the land and classified as markets when BBMP owns the structures.

Property tax collection has reached Rs.2,967 crore this fiscal, the highest so far. It is still far below the potential, according to the Economic Survey . Meanwhile, there is a call to include professional tax, entertainment tax and luxury tax -the city generates over Rs.1,000 crore -in the BBMP tax net.

Also Read

Ward committees should have a say in Bengaluru budget: Citizen groups

Bengaluru budget: Major fiscal overhaul for BBMP on the cards

All you need to know about Bengaluru Budget 2017-18

A hitchhiker's guide to Bengaluru's Budget this year

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