Karachi: CDGK’s infrastructure tax move flops

[Naveed Yaseen]

By Qadeer Tanoli
The City District Government Karachi (CDGK) has failed to collect infrastructure tax which was imposed on housing units, The News has learnt.

It was further learnt that the CDGK can collect only five percent of the infrastructure tax which was levied on the time-frame of three months. The CDGK, however, has failed to collect the tax from all cantonment boards, including the Defence Housing Authority (DHA), the Civil Aviation Authority (CAA), the Karachi Port Trust (KPT,) and some agencies.

CDGK Executive and District Officer (EDO) Municipal Services Masood Alam said that 1.28 million subscribers were delivered bills for three months regarding infrastructure tax and only five percent of them responded positively.

He said the public at large did not react to this new tax as was being thought, and cantonment boards, including the DHA, were delivered bulk billing amounting to Rs25 million for three months and not a single penny was deposited by them in this regard.

He said that the CDGK had no data of housing units in the cantonment boards and other agencies. “We got zero percent recovery of the tax from DHA and other agencies and in return they inquired what type of tax it was. They tried to convince us that they are not using our infrastructure so they are not liable to pay it,” Alam said.

He said all such organisations wanted the CDGK to waive the tax, even though they were using the CDGK’s infrastructure.

According the collection data, recovery from the Bin Qasim Town remained zero percent and the CDGK could collect 0.07 percent of the levied tax from Keamari Town. Likewise only 0.41 percent was collected from Lyari Town, while residents of Orangi Town and Jamshed Town paid 0.17 percent and 1.47 percent respectively. Recovery from Gulshan-e-Iqbal Town was prominent at 25 percent and collection from Korangi stood at two percent only.

Recovery of the tax from Gulberg Town remained five percent and only 10 percent of total house units in Shah Faisal Town paid the tax. The EDO said that an aggressive campaign would be launched against citizens involved in tax evasion. Cases could be attached with the land acquisition act and they might be arrested as well under the act, Alam said.

He maintained that the authority concerned may also opt to auction the household items of the person who refuses to pay the tax. Recently, union council (UC)-9 of Gulshan-e-Iqbal was made the target for the recovery of the tax and the consumers were given a week’s time to deposit their dues, otherwise legal action would be taken against them.

Public utility charges for municipal services under the head of ‘infrastructure tax’ (Rs70 per month) are also imposed on house units of 40 square yards. Units constructed over the area from 81 square yards to 120 square yards are liable to pay Rs150 per month as the tax.

Housing units spread over 501 square yards to 1,000 square yards are liable to pay Rs500 only, and house units which are constructed on plots measuring 1,001 square yards or above are required to pay Rs800 only.

Alam said the city government has planned to recover Rs3 billion per annum under the head of infrastructure tax. He said this tax was not being collected from Katchi Abadis and would be collected only from leased residential areas.

He said besides the tax, consumers are also liable to pay Rs8 as bank charges. He said no land had been left in the city to sell and get some revenue for the city government expenditure, and this tax will help carry out maintenance of developmental project of the government.

The CDGK has now started the distribution of bills for April, May and June.

http://www.thenews.com.pk/daily_detail.asp?id=175886