MCC losing money by not collecting motor vehicle cess

MANGALURU, Karnataka: G Hanumantha Kamath, President of Nagarika Hitarakshana Samithi, in a public consultation meeting with the Mangaluru City Corporation (MCC), highlighted that the corporation has been incurring huge revenue losses due to non-collection of motor vehicle cess (infrastructure cess) under the Karnataka Municipal Corporations Act, 1976.

Comments of Kamath came during a second roundtable organised by the corporation seeking public consultation to augment its revenue ahead of budget for 2024-25. He added that the Municipal Corporation Act permits to levy and collect infrastructure cess.

This cess has been introduced in the act to fund the infrastructure development within the precinct of the corporation. On the other hand, MCC has not been collecting the motor tax, thereby incurring monetary losses each year. The Act allows the civic body to collect ₹50 per two-wheeler, ₹100 per three-wheeler, ₹300 per four-wheeler and ₹500 per goods carriage vehicle as motor vehicle tax.

Section 103 B of the Karnataka Municipal Corporations Act reads, “The Corporation may in addition to the tax levied under the Act, levy and collect an infrastructure cess, at such rate not exceeding five hundred rupees per annum as may be prescribed on every motor vehicle suitable for the use on roads within the city and different rates may be prescribed in respect of different classes of motor vehicles.”

Also, the civic body has not revised and increased its building license fee for the past three decades. For example, the slum development cess, which is also part of the fee, is still at 20, 40, and 50 paise per sqm for commercial buildings.

Apart from that, unauthorised hoardings have been another cause of concern due to which the corporation is losing money. Furthermore, there is no correlation between the fee charged and the actual size of the hoardings installed. The civic body is not cross-checking whether the installer has paid the correct amount for the actual size of the poster. Because of this huge posters are being propped up by paying the fee for a smaller poster. Kamath also raised the issue of the pending water bill of the civic bodies. For example, Ullal Municipality owes ₹2.19 crore, while Mulky Town Panchayat owes ₹1.02 crore, Chelyar Gram Panchayat ₹6.43 lakh and Bala Gram Panchayat owes ₹27.34 lakh to MCC.