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Sector 5 Civic Body Asks Govt To Revise Tax Structure

By sachiv1, Section News
Posted on Fri Jun 08, 2007 at 03:03:18 AM EST

IT companies operating out of Sector V in Salt Lake may have to cough up higher civic taxes if a proposal mooted by the Nabadiganta Industrial Township Authority (NITA) is accepted by the state government.

Unhappy with the "low tax rates" for Sector V, the authority, that has taken over local governance of the IT hub from Bidhannagar Municipality, has asked the state government to frame a new tax structure that would enable it to generate more revenue for the upkeep of the township. Low revenue earnings is hindering the authority from upgrading civic services and developing the IT hub.

According to NITA, it has been loosing out on revenue since the civic taxes imposed earlier by the Bidhannagar Municipality was not enough to sustain the upkeep of Bengal's Silicon Valley. And, till the state government frames a new tax structure for Sector V, NITA will have to continue collecting the `low taxes' imposed by the municipality. It has been doing so for the last 16 months since its formation on February 1, 2006.

NITA has now requested the state government to frame a new tax structure that would enable it to generate more revenue. "A new tax structure will take some time to take effect as it will have to go through an administrative process. We are working on this matter," said NITA chief executive officer Anup Motilal.

"We will soon start collecting taxes for the fourth quarter," said Motilal. Following the prevailing old tax structure, the tax payable by the IT firms works out to 10.5% of the total annual rental value of the office spaces they occupy.

There are about 170 companies located in Sector V at present. About 30,000 to 40,000 people work in the area. Officials concede that the tax they are collecting now is not sufficient to implement various civic projects. NITA has recently announced its budget that has been pegged at only around Rs 5 crore. Officials admit that the amount is too small to develop Sector V. NITA is currently taking Kolkata Metropolitan Development Authority's help to spruce up the civic infrastructure at the IT hub.

Managements of companies in Sector V are ready to cooperate with NITA in this regard. "Whatever NITA decides to provide better civic amenities and services would be welcome," said Infinity Infotech Parks Limited manager Piyush Goenka.

Source:The Times Of India,08-06-07

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