Already faced with deep financial crisis, the yearly tax collection of municipal corporation of Delhi from commercial vehicles has suffered a sharp decline. However, a year later and after losing over Rs125 crore, the Capital’s cash-strapped civic body got a new toll tax contractor on Saturday.
Toll tax collected from commercial vehicles entering Delhi is one of the biggest revenue sources for the civic bodies. But for a year now the corporations were unable to appoint a new concessionaire after the previous three-year contract ended on May 15, 2014.
However, the civic bodies on Saturday signed a new three-year concession agreement with SMYR Consortium, which will net the corporations Rs541 crore per year as the reserve price plus Rs11 crore in earnest money deposit.
According to a recent survey, the annual collection of taxes by the civic body should be Rs2,146 crore. But, the new SMYR Consortium is estimated to create a monetary shortfall of a whopping Rs1,635 crore every year. The three corporations stand to gain a mere Rs511 crore from the toll collection.
The contract will come into effect from May 16. Officials said that the estimated amount of revenue deficit alone can serve for six months salary for both NDMC and EDMC employees.
The non-payment of salaries of the two MCDs have affected the sanitation services, there are about 35,000 employees in EDMC and 65,000 in NDMC. The two civic agencies spend nearly Rs3,100 crore yearly on salaries for sanitation workers.
The brinkmanship between the municipal corporation and the Delhi Government has intensified with the employees going on strike this year. NDMC mayor Ravinder Gupta has said that the corporation will take to the streets if the Government does not confirm to their demands.
Sources blamed the impossibility of the civic body to employ adequate manpower to check the revenue leakage for tax collection.