The Talking Point: Two Budgets. Ahmedabad Municipal Corporation Budget and Union Budget 2023-2024.
Taxing Truths: Amdavadis are you ready for this? In short, taxes have been hiked in Ahmedabad Municipal Corporation’s (AMC’s) draft budget, tabled Tuesday by the civic body’s commissioner, M. Thennarasan.
A-listers in the Hike Chart: Something called “User Fee” and of course, property tax. With an annual estimated outlay of Rs 8,400 crore, an increase from Rs 8,111 crore in 2022-23, AMC now seeks to levy Environment Improvement Charges (EIC) for residential and non-residential properties. Also proposed is an increase in property leasing rate — for first time in ten years.
The hike in property leasing tariffs is between 32 to 44 per cent, in addition to a yearly hike of 5 per cent. The EIC charges will mean an addition of Rs 3,000 and Rs 7,000 for residential and non-residential properties, respectively.
Citizen-Centric Budget: The budget plans to eradicate inequality in education and health areas, nutrition and everyday requirement like toilets. In wake of difficulties in finding a rented accommodation for single women and female students, the draft budget has proposed a working women hostel in eastern and western areas. Also, one “she lounge” per ward has been proposed only for working women where they can rest with facilities like toilets as well as a crèche.
During his briefing to the media Tuesday, Thennarasan termed the budget as “participatory and citizen-centric budget”, while also calling it “gender budget.” The draft budget has proposed “to do away with inequality with women.”
Did you ask for justification? Justifying the hike in property tax rates after a decade, he added: “The last 10 years have seen a huge in essentials: milk by 122 per cent, edible oil by 130 per cent, cable connection by 250 per cent, cloths 120 per cent, cooking LPG by 150 per cent and electricity charges by 100 per cent. However, the property tax for commercial and residential properties remained same since 2013. In last ten years with the introduction of GST and increase in the wholesale index prices, the tender costs increased resulting in administrative expenses being pushed up.”
What is this User Fee? If approved by the AMC standing committee, Ahmedabad residents have to pay the EIC. During his tenure, Thennarasan had introduced it in Surat in 2018.
“Since we do not have a pollution measuring tool, residents will be charged under EIC on polluter pay principal based on the fact that those not using the public transport are using their own vehicles and thus resulting in higher pollution levels. Property owners with more than 100 square metre carpet area are not using public transport. This is a hypothesis,” the Municipal Commissioner stated terming the EIC as “not a tax but charge”.
All said and done: As the AMC standing committee sits over the proposals, Union Finance Minister Nirmala Sitharaman today presented the last full-fledged Union Budget of the Modi government before the 2024 Lok Sabha elections.
Here is a list of products that are set to get cheaper or more expensive:
Things that are set to be costlier:
Articles made from gold bars
Electric kitchen chimney
Imported bicycles and toys
Electronic vehicle imports
Things that will become cheaper:
Parts for mobile phones
Parts for TV panels
Machinery for lithium ion batteries
Raw materials for EV industry