Recently the Chennai Corporation finalised an action plan for the augmentation of its source of revenue following a Comptroller and Auditor General (CAG) report.
As per the new plan, the Chennai Corporation has increased its source of revenue by 85.6% after taking initiatives to increase property tax collection. After increasing the property tax rates, the own source of revenue of the Chennai Corporation has increased to ₹2,302 in 2022-2023.
Before the implementation of the initiatives to increase its source of revenue, the civic body had reported a revenue of ₹1,240 in 2017-2018. After increasing the property tax rates, the own source of revenue of the Chennai Corporation has increased to ₹2,302 in 2022-2023. During 2021-2022, the property tax collection increased to ₹11,615 crore.
The most significant and reliable source of self-generated income for local governments is the property tax. This will help the local governments to remain viable, cover incurred costs, and give the general public a better service in general. Increased taxes would lessen local governments’ reliance on state transfers.
In consideration of the delay in the release of the performance grant of ₹1,323 crores after 2017, the CAG had stressed the need for fiscal autonomy. The property tax collection of the Chennai Corporation was around ₹1,500 in 2022-23. With the work on re-assessment of the property tax underway, tax collection is expected to increase this year. The number of property tax assessees has also crossed 14 lakh in the 15 zones of the city.
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