The Shimla Municipal Corporation (MC) has decided to go with the old system rather than switch over to the proposed unit area method. MC taken this decision at a special house of the MC convened under the chairmanship of Mayor Sanjay Chauhan to discuss the issue. The Mayor, along with other councillors, will meet the Chief Minister in this regard and will detail their reservation to him.

A committee headed by Deputy Mayor Tikender Panwar had been asked to submit its report on the issue of charging property tax. The committee had observed that after taking into consideration the socio-economic condition of people, it would be inappropriate to switch over to the new system.

The members unanimously adopted a resolution urging the government to bring about an amendment so that the old system, based on annual rate value (ARV) for working out property tax, can be followed. The MC gets revenue of about Rs 12 crore from property tax from house owners within the municipal limits.

It was in February 2012 that the government had issued a notification to impose property tax on the new unit area method, but the MC while expressing reservations about the system had kept it on hold.

Owing to the reservations on the issue, the MC did not charge property tax from people last year, which resulted in a loss of Rs 12 crore to it and further worsened its financial health.

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