The East Delhi Municipal Corporation is estimated to have a deficit of over Rs.2,200 crore in the next financial year, while it plans to introduce new taxes to earn about Rs.30 crore annually.
Revised budget estimate
According to the budget proposals for 2017-2018 made by EDMC Commissioner Mohanjeet Singh at a special meeting of the Standing Committee on Wednesday, the civic body is estimated to suffer a deficit of Rs.2,243.25 crore. As per the revised budget estimate (RBE) for 2016-2017, which was also presented on Wednesday, Mr. Singh said the deficit for the current fiscal would be Rs.2,041 crore. In 2015-2016, the EDMC suffered a deficit of Rs.202.06 crore.
The Delhi government owes the EDMC Rs.4,928 crore from 2012-2013 till now as per the recommendations of the Fourth Delhi Finance Commission. The EDMC has been in the red since its creation in 2012. East Delhi’s revenue generation was the lowest compared to the North and South civic bodies, while its share of liabilities was not considerably less.
So far, the EDMC has racked up Rs.590 crore in unpaid arrears and final payments to retired staff, Rs.600 crore in dues to regularised sanitation staff and Rs.150 crore in dues to contractors.
Keeping in mind its financial situation, Mr. Singh proposed three new taxes to increase revenue. A 5 per cent education cess on property tax, a tax on profession, trade calling or employment (Rs.1,200 to Rs.2,500 per year) and a betterment tax of 15 per cent of the property tax was proposed. These would net the EDMC Rs.30 crore a year, if approved by the House.
However, the BJP leadership in the EDMC is unlikely to accept this proposal, especially since 2017 will be an election year. Meanwhile, improving sanitation, simplifying services and generating revenue were the areas of focus for the budget. Sanitation would get the biggest chunk of the Rs.3,822.13 crore expenditure budget with 25 per cent, followed by education (23 per cent) and general administration (15 per cent).
