Budget for B'luru: Civic body hopes new revenue streams will fill coffers

Maqsood Maniyar | NT

Bengaluru: Bruhat Bengaluru Mahanagara Palike (BBMP) appears to be moving towards greater self-sufficiency as the share of state and Union governments in its Budget dipped by a little over 4.1 per cent.

The share of the State and Centre was 37 per cent in the 2023-24 financial year. The share has dipped to 32.9 per cent for 2024-25, which comes to Rs 4,077.59 crore.

The size of the Budget is Rs 12,369.46 crore. This may be down to some changes in policy by the state government.

The civic body gets most of its revenue from property tax. However, under the BBMP (Amendment) Bill, fines for property taxes have been slashed by half.

They are also hoping to rake in revenue through property tax arrears by way of a One Time Settlement (OTS), a policy the state government favours.

The administration hopes to add revenue from some “premium” building taxes such as those mandated under the Floor Area Ratio (FAR) or the Karnataka Town and Country Planning (Amendment) Bill, which is expected to add Rs 1,000 crore to the kitty this year.

It will allow builders to construct additional floors by paying a 40 per cent guidance value.

The new structure will come into effect on April 1. The property tax target for the financial year is pegged at Rs 4,470 crores. Usually, 80 per cent of the target is achieved.

Banking on Property tax

Economics professor at the Institute for Social and Economic Change (ISEC) Krishnaraj said the civic body had to bank on property tax since it is their biggest income.

“I think the real estate sector is the fastest growing sector. There is a need to plug leakages,” he said, adding there is a need to ensure online payments, especially those by the big fish. Krishanaraj , however, warned that “vertical growth” will lead to more congestion.

“This growth isn’t sustainable,'' he felt.

The BBMP is hoping to rake in additional advertisement revenue of Rs 500 crore through their new policy modeled after the Delhi Municipal Corporation (DMC), which was approved by the Supreme Court.

The model doesn’t allow for advertisements in “national parks, historical monuments, world heritage areas and religious places” besides prohibiting “nudity, racism, drugs, cruelty to animals or any kind of violence”.

More taxes way out?

Professor Krishnaraj suggested that the civic body could add to their coffers through heavy taxes on “big, fat weddings” such as those conducted in Palace Grounds since they generate a lot of waste, which the BBMP then has to clean up and commit resources to do the same.

Soft drink and mineral water companies that are allowed to buy plastic to compensate for the plastic waste they produce.

They could be asked to pay an additional tax for the same instead, he reasoned.