New Act on anvil to let Corpns seize property for tax default

CHENNAI: Giving more teeth to property tax collection efforts, the State government is framing stricter rules under Tamil Nadu Urban Local Bodies Act that is on anvil. Under this, the city Corporations across the State would have powers to even confiscate properties if their owners fail to pay up the tax they owe.

Though the Chennai City Municipal Corporation Act and Revenue Recovery Act have provisions to allow the Greater Chennai Corporation to confiscate properties of the defaulters, the officials seldom use them because the provisions are weak. “The new Act will have stronger clauses to issue distress warrants and confiscate the defaulters’ properties,” a Corporation official told DT Next.

The move comes after several measures by the civic body, including imposing penalty on building owners who fail to pay their half yearly property tax before April 15 and October 15, failing to find success. Several property owners, a majority of which are big commercial establishments, still do not pay tax on time. “Once the new Act comes into effect, there will be no arrears that we have to run behind. Presently, around 5,000 big defaulters alone have arrears to the tune of Rs 150 crore,” added the official.

The new Act will also allow property owners to self-declare the size and usage of the properties, based on which the civic body will calculate and collect taxes. “While allowing the owners to self-declare the details, the Act will also empower the civic body to conduct random inspections to check the veracity of self-declarations. If any property owner is found to have provided false information, penal actions will be taken. This will prevent under-assessments,” the official explained.

He also recalled a few incidents that they noticed during property tax revision in 2018. “During the drive, we came across a few properties in the extended zones that had just Re 1 and Rs 2 as tax. Some were even marked as 0 sqft. We revised their taxes in 2018, but only to be withheld by the government. Severe action should be taken in such cases, which we can take under the new Act,” he said.

A drone survey conducted a few years ago had revealed that more than 2 lakh buildings in the core city zones were under-assessed.