Doubling taxes overnight

While the Delhi government appears to be in a quandary as to just how much of the city’s constructions are unauthorised, help could soon be at hand, ironically from a system the government itself is in the process of implementing. The system, by the way, is also being implemented in 57 cities in Karnataka and also has the potential to at least double property tax collections in each area. But first, some numbers.

Of the 7.3 lakh or so properties in Bangalore, just 5.3 lakh are assessed and just around half of these pay taxes—around Rs 225 crore each year. Using a rule of thumb, therefore, getting Rs 500-600 crore out of property taxes in Bangalore shouldn’t really be that tough, should it? Delhi is supposed to have around 25 lakh properties in the MCD area, but the MCD has records of just, hold your breath, 10 lakh properties! In macro terms, for the country as a whole, urban areas contribute 55 per cent of the country’s GDP and utilise around 3 per cent of the land, but municipal revenue is just a little over 0.5 per cent of GDP.

Over a year ago, the government in Karnataka decided to use the eGovernments Foundation to combine the GIS mapping of the city with a management information system to set up a complete property tax collection system. So, each street and property in 57 cities to begin with is being numbered, photographed and all other details such as the area covered (even, if you wish, whether it has municipal certificates!) are being entered into the IT system; at the same time, all the existing property records are also being digitised and married with these cadastral maps. Now, at one click of the button, you can actually see all the houses in a particular street and see how much tax they’re paying—since, as in Delhi, various cities are now moving to the unit-area-method where property taxes are based on the land area and not the cost of construction, presumably the taxes each house pays on a particular street should be similar if their plot sizes are the same. Imagine a system like this, where property tax inspectors can, even sitting in their offices, figure out just where the problem is and tell their collectors exactly which house to visit for their investigation.

Since there is a host of information that the maps contain—is the property residential or commercial, what is its built-up area, what kind of a roof does it have, and so on—the taxman can run almost any kind of search, or have almost any kind of alert get thrown up automatically. Which buildings in Koramangala don’t have authorisation certificates, how many non-residential buildings are there in a particular area, which properties haven’t paid their taxes this year, which houses in a street are paying under 70 per cent of the average being paid by others in the street (chances are there’s a problem here, isn’t there?), the list is endless. Indeed, when the demo was first shown by the eGovernments team to the chief minister of Karnataka, his first question was whether he could get a map of all the unauthorised constructions in the city! Anecdotal evidence suggests that even though the system is yet to be fully operationalised, even the act of getting GIS mapping done in certain cities in Karnataka has resulted in an increase in tax collections from citizens, who obviously feel it’s time to pay their dues to society.

The Delhi government, which is also implementing a similar scheme (it is expected to be launched in the next financial year), but without the GIS mapping and photographs of the property, has added some other interesting modules which, when completely operationalised, are supposed to take the government’s accountability on a par with cities like Chicago, whose IT systems allow citizens to log on to the site and even get details of various contracts entered into by the city (like for lifting garbage, for instance), the rates at which such contracts have been negotiated, the past history of the contractor, and so on.

Of course, no matter how fancy or foolproof a system you install, it can only be as effective as you want it to be. As part of Chief Minister Sheila Dikshit’s IT-cum-citizen-friendly drive, the IT system has a consumer grievance module that has been active for over a year (www.mcdonline.gov.in). The system allows citizens to not just register their complaints, but to check the status of the follow-up on these, to see what each bureaucrat has to say on the matter, and if the complaint does not get acted upon within a certain time frame, it automatically gets kicked upwards to a higher level and so on. Very impressive, most of us thought when it began and when the chief minister first told us about it. The complaint section itself is based on drop-down menus (waterlogging, garbage not cleared, streetlight not working, and so on) and the order in which these appear also changes automatically, depending upon which complaint is made the most often!

Go to the site today, and the statistics are shocking. First, there are just around 4,500 complaints in a city of nearly 14 million. While that’s more a reflection on the capital’s internet penetration than on how well the city is run, less than a sixth of these complaints have been attended to—none of the 159 health-related complaints has even been attended to, for instance! Anyone recommending similar IT-based solutions (a modified e-Gov-type solution has been proposed for ensuring the rural employment guarantee scheme delivers the goods) would do well to keep in mind that where there’s no governance, there can be no e-governance either.