Kerala finance panel for rationalizing tax rates, fee structures
September, 21st 2015
The fifth state finance commission said that the avenues for revenue mobilization of civic bodies should be strengthened by revising tax rates and fees charged by the local bodies and they should be given freedom to carry out those projects.
After eliciting the views of the political parties here on Saturday, the commission chairman B A Prakash said that the rates of taxes and other fees collected on various services by local self-government institutions had been untouched for the past 25 years and steps to should be taken to rationalize the rate of taxes and fees structures.
Representatives of various political parties including the Congress and the CPM shared their views with the commission on devolution of funds to local bodies that would be considered by the commission before finalizing its report. "Many party representatives were of the opinion that professionals and traders who are now out of the tax net should be brought in," said B A Prakash.
Prakash said that commission would submit the first part of the report with regard to devolution of funds in December, so that government could incorporate its recommendations in the budget for 2015-16. "The commission is of the view that there should be a periodical revision of taxes and fees charged by local bodies at least once in five years," he said. The chairman added that this was one of the main suggestions put forward by representatives of major political parties in Saturday's meeting.
He said that the political parties also wanted freedom for civic bodies to implement development projects, and the commission also agreed with this.
In its recommendations before the Commission, the Congress, represented by MLA V D Satheesan and Johnson Abraham, said that the commission should recommend that maintenance funds that were sanctioned for the local bodies for asset maintenance should be given only after proper verification and it should also be ensured that such funds were only used for the purpose. In addition, the party also requested the commission to increase the road maintenance grants for local bodies. The party also requested the commission to recommend the government to increase the honorarium for the elected local body representatives.