KARACHI: Sindh government, in collaboration with World Bank, has decided to devolve property tax collection powers to the local bodies.
The development of a database of land revenue and capacity building of local bodies staff will soon be initiated.
These decisions were taken by Chief Minister Syed Murad Ali Shah in a meeting with a World Bank team led by senior economist Yoonhee Kim, urban development specialists Sohaib Athar and Takaaki Masaki, and public sector specialist Irum Touqeer.
The Sindh government delegation led by the chief minister comprised Minister Local Government Jam Khan Shoro, Karachi Mayor Waseem Akhtar, Principal Secretary to CM Sohail Rajput, and Secretary Excise Haleem Shaikh.
The chief minister, in his opening remarks, said that he had already devolved property tax powers to the Karachi Metropolitan Corporation, but the KMC still needed to develop a system for collection of taxes. He added that a property survey had been conducted in Sukkur.
Earlier, there were only 35,000 households registered for collection of property tax, but the fresh survey revealed that the number of such households had increased in the district to 65,000.
The World Bank team, through a presentation, said that the current collection of property tax in Sindh was Rs2 billion, while there was a potential of increasing the tax revenue to Rs7.2 billion. Citing examples from Punjab, they said that the province had collected $88 million during 2015-16. In India, the city of Mumbai collected $373 million in property taxes, followed by Banglore $201 million, Hyderabad Deccan $179 million, and Chennai $90 million.
“These figures are meant to show the potential of Karachi in terms of its size and households,” they said.
The World Bank said that the tax base has been eroded owing to generous exemptions by the government. It was also pointed out that the administration of property tax was based on ‘old’ system, “the current billing system is not fit for the purpose.” They recommended a self-assessment and self-payment platform for property tax customers was the need of the hour. “The property tax arrears constitute a major problem and significant loss of revenue.”
The meeting agreed to take immediate measures within the next three months. These measures include agreement and legislation about UIPT devolution road map and institutional arrangements and survey preparations.
The bank suggested that surveys should be completed along with preparation of property tax database in phase-I (July 2018 to June 2020). Subsequently, training and capacity building of DMCs staff, procurement, pilot deployment of ICT system for DMC would be undertaken.
It was decided to undertake a full survey of all buildings in all six DMCs of the city; collect qualitative and quantitative data for each building, including property use, to collect the GPS co-ordinates for each building including digital image and to build upon the experiences from Sukkur.
It was also decided to establish an IT Revenue Management System (IRMS) for DMCs. There would be a hardware and software determine host for the data server. DMC staff would be involved in the buildings survey and they would be provided training in the new IT Revenue Management System, in property tax management including valuation, law, billing, collection and enforcement taxpayer/customer services training
On this, the chief minister directed the Excise Department to identify and legislate changes needed to support a modern, ICT-based Revenue Management System. “We would also bring in legal reforms needed to move to a self-assessment and on-line self-payment system.”
Separately, Murad Ali Shah said that the law and order situation in the city was under control and fool proof arrangements were in place for the PSL-final match.
He made these observations while talking to the media during a visit to the national stadium. He was accompanied by provincial Home Minister Sohail Anwar Siyal and Local Government Minister Jam Khan Shoro.
He said that he had held a number of meetings to review the arrangements inside and outside the stadium. “The Sindh government has prepared a beautiful ground within the premises of the stadium for practice sessions and other matches,” he said
He added that greenbelts along connecting roads and streets had been revamped and compound walls in the area decorated. Repair works had also been completed, he said, adding, “This is our event and we will all have to make it a successful.”
Replying to a question, Murad Ali Shah said that he had provided enough funds to the KMC so that all roads, sewerage lines, lifting of garbage and such other civil works could be done. “The mayor of Karachi has enough powers and he is also working for the betterment of the city,” he said.
Talking about Wednesday’s suicide attack in Lahore, the chief minister said that it could not be linked with the law and order situation in Karachi. “We have taken strict measures, have broken the networks of terrorists,” he said, adding, “We are making the peace in the city sustainable.”
“Nobody would be given passes to attend the PSL final match. To enjoy the match, you have to buy the ticket, otherwise you can have fun watching it on your TV sets at home,” he said, in response to a question.
Shah said that he wished best of luck for all the teams participating in the PSL matches but being chief minister of Sindh and a diehard Karachi’ite he was supporting Karachi Kings.
Earlier, the chief minister visited all under construction/renovation parts and enclosures of the National Stadium and directed the local government minister to get it completed by March 22.
Published in Daily Times, March 16th 2018.