For Kochi civic body, proper revenue collection is key

Property and professional tax and rentals are the major sources of revenue for the corporation.
For Kochi civic body, proper revenue collection is keyKOCHI: Despite Kochi being the commercial capital of the state, city corporation finds it difficult to mobilize its own revenue and depends mostly on plan fund and centrally-sponsored projects.

Designing fanciful projects to generate revenue and adopting effective steps to collect revenue will certainly lead to a leap in the corporation’s revenue.


The corporation authorities do not have any idea on the number of buildings in the city. As per estimates, there are around 50,000 buildings in the city and around 1.5 lakh door numbers.

“The amount we collect from property tax every year on an average is around Rs 69 crore,” said Paul M Philip, revenue officer, Kochi corporation.

The corporation is yet to move on to the new method to collect property tax completely.

Earlier, the tax for each building would be fixed as per average rental value (AVR). Later, it was replaced with plinth area (total built-up area) based property tax collection. “Now, the property tax of a residential building is being calculated by multiplying the plinth area with Rs 20. If the building is rented out for residential purpose, it would be plinth area multiplied with Rs 40. In case of commercial space, the property tax would be the fixed by multiplying plinth area with Rs 90,” said a corporation official.

“Still, the process of assessing tax for each building in the city is slowly progressing. Owners of most of the buildings in the city pay the tax as per the earlier method of AVR. Compared to AVR, plinth area method will at least double the amount collected as property tax,” he said.

As per a survey conducted around five years ago, the number of unauthorized buildings in the city stands at 16,000. Now, the number would be at least 20,000.

“Though we started a drive to collect tax from unauthorized buildings some five years ago, it didn’t work due to various reasons, including political pressures,” said K J Sohan, former mayor.

A building becomes unauthorized if there is any deviation from the plan which was approved by the civic body. Property tax would be three times the tax charged from authorized buildings.

“Even if we collect tax from at least 5,000 commercial buildings, the revenue through property tax would go up many fold,” Sohan said.

“Now that there is no election round the corner, there won’t be much political pressure against taking action on unauthorized buildings. So, it is the apt time to resume such a drive,” he said.

As per the local fund audit report, only insignificant number of professionals like lawyers and doctors pay professional tax. If special adalats to collect arrears from lawyers and doctors alone are organized, crores of rupees can be collected.

Rent of the corporation’s buildings has not been revised for the past few decades. Revising the rent would also see a jump in the revenue.

Many of the educational institutions in private sector in the city don’t pay property tax to the corporation.

A major hospital in the city hasn’t paid property tax for buildings which house their educational institutions and the defaulted amount comes to around Rs 30 crore.

Special drives for collecting property tax from unaided educational institutions should be initiated.


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