MCC incurring revenue loss by not collecting motor vehicle cess under Karnataka Municipal Corporations Act, 1976, says activist

The Mangaluru City Corporation (MCC) has not been collecting infrastructure cess (or motor vehicle cess) under the Karnataka Municipal Corporations Act, 1976. Hence the civic body is losing huge revenue every year, G. Hanumantha Kamath, president, Nagarika Hitarakshana Samithi, said

The Mangaluru City Corporation (MCC) has not been collecting infrastructure cess (or motor vehicle cess) under the Karnataka Municipal Corporations Act, 1976. Hence the civic body is losing huge revenue every year, G. Hanumantha Kamath, president, Nagarika Hitarakshana Samithi, said here on Tuesday.

Speaking at the second round of public consultation meeting called by the corporation to seek suggestions to augment its revenue before preparing its Budget for 2024-25, he said that the Act allows for the levy and collection of infrastructure cess.

The purpose of this cess is to fund infrastructure development within the municipal corporations of Karnataka. But the Mangaluru City Corporation is not bothered to collect it, he said.

Section 103 B of the Act says: “...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.”

Mr. Kamath said that the Act allows for collecting ₹50 per each two-wheeler, ₹100 per three-wheeler, ₹300 per four wheeler, ₹400 per passenger vehicle, and ₹500 per goods carriage vehicle.

He said that the civic body has not revised its building licence fee upwards for the past three decades. For example, slum development cess, which is part of the fee, still stood at 20, 40, and 50 paise per sqmt. for commercial buildings, Mr. Kamath said, adding that with this the corporation is losing huge revenue.

Unauthorised hoardings which have come up in the city have caused revenue loss he said, adding that there is no correlation between the size of the hoardings and the fee charged. For example, if an installer took permission for erecting a small hoarding by paying the prescribed fee for its size, in reality there will be a huge hoarding in place for which a larger fee had to be paid. The civic body never bothered to check such cases, he said.