Cash-strapped Vijayawada Municipal Corporation (VMC) has reportedly taken a decision that it will not “shy away” from taking action against tax defaulters under its ambit. Term it lack of political will or poor recovery policies, the civic body, over the years, has adopted a “wait-and-watch” policy to tighten the noose around the defaulters—residential, commercial or public entities.
Despite several pleas to the Central and State government offices to clear their property tax dues amounting to several lakhs, they failed to do so, a senior VMC official said. As per the norms, the State government offices should send a representation to the departments concerned seeking them to sanction budget for clearing property tax dues. However, there is no response from the government to sanction the budget for the respective department, which is accounting for more tax dues to the VMC. In all, the civic body has total tax arrears of around Rs 150 crore, he said.
Ironically, the Central and State government offices and educational institutions figured in the list of tax defaulters. Among the major defaulters is South Central Railway (SCR), which owes Rs 30 crore to the civic body. A couple of years ago, the South Central Railway cleared only a meagre Rs 20 lakh tax dues and promised to clear the rest in a phased manner. So far, there is no response from the South Central Railway in clearing the remaining dues.
Property tax is another source of revenue for the Corporation to undertake various infrastructure projects. To recover dues, the VMC officials have met the representatives of various government offices and educational institutions and appealed to them to clear their dues. However, there has been a lukewarm response to the appeal of VMC officials. “During a recent meeting held with the revenue officials, the officials were instructed to initially serve notices to the major tax defaulters and later take legal recourse,” the official said.