Poor recovery of taxes pushes AMC to suffers loss of Rs 250 cr during Covid-19 situation

Aurangabad, Sept 23:
The Aurangabad Municipal Corporation''s (AMC) income in the form of taxes has reduced by Rs 250 crore due to Covid-19 pandemic situation in the city for the past six months.

Every month, the state government releases share of LBT to the AMC, which is to the tune of Rs 25 crore. The AMC pays staff salaries, pensions and electricity bills from the share. Needless to say, the AMC is reeling under a financial crunch for the past few years. The civic body got under debts as development works undertaken by it were of valuing four times more than the actual income. As a result, the AMC failed to pay Rs 240 crore dues to the contractors in the last two years. Moreover, the contractors are not ready to undertake new development works as their dues are yet to be cleared.

The month of March is very important for the AMC as receives property tax from various government offices and other big establishments during this month. Due to Covid-19, from April to August, the AMC received Rs 33 crore in the form of property tax, against the expectation of Rs 100 crore. The town planning is another important source of revenue for AMC, but the section could also garner Rs 13 crore only in the past five months. The estate section has succeeded in collecting an income of Rs one crore during the lockdown.
" The poor financial condition has forced the AMC to focus on enhancing property tax collection," said the acting chief accounts officer Sanjay Pawar.

The monthly statutory expenses of AMC include payment of Rs 50 lakh to tankers supplying water to more than 200 localities in the city, Rs 2 crore to garbage lifting contractor P. Gopinath Reddy, payment of self-help groups, Rs 2.72 crore to the company which had installed LED lights and erected poles in the city. Above all, the civic body also pays electricity bills of crores of rupees every month. It is crystal clear that the AMC would have to walk on a tight rope to maintain its expenses during the current financial year, it is said.