GHMC plans reforms in calculation of trade licence fee

Hyderabad: In a bid to increase revenue, the Greater Hyderabad Municipal Corporation (GHMC) is planning reforms in trade licence fee calculation and collection by introducing a new system of assessing the fee based on the area of an outlet.

At present, the municipal corporation calculates and collects trade licence fee for business and commercial establishments with a maximum ceiling of about Rs 2 lakh per outlet. This was resulting in a meagre fee collection for the municipal corporation as irrespective of the outlet’s size, including malls, there was a maximum ceiling.

Under the proposed reforms, the municipal corporation intends to calculate the trade licence fee based on the area of the outlet and the locality it is being operated. Accordingly, the GHMC officials will be assessing the area of an establishment and finalise the fee and it could vary from one prime commercial area to other, said a senior official from GHMC.

This will make the establishments obtain trade licence and increase revenue for the municipal corporation, he said.

Currently, there are over 15 lakh structures in the city , which are assessed for collection of property tax. Of these, nearly 2 lakh structures are identified as commercial buildings and only 70,000 establishments have obtained trade licence.

As a result, the municipal corporation does not generate more revenue through trade licence fee. Last financial year, the GHMC collected about Rs 56 crore and this year, officials have set a target of collecting over Rs 70 crore.

There are lakhs of commercial establishments in the city but not all the establishments possess trade licences. To make the process of seeking trade licences easy, the GHMC offers the facility of applying online, at e-seva centres, citizen services centres and at circle offices. The GHMC has also introduced self-declaration for obtaining trade licence online.

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