Revnue collection: UCs, IMC in taxing row

Opposition members lament lack of funds for cash-strapped local govt

ISLAMABAD: With Union Councils (UCs) now collecting taxes, a new conundrum has arisen for the self-sufficiency seeking but cash-strapped Islamabad Metropolitan Corporation (IMC).

Several UCs in the Islamabad Capital Territory (ICT) have imposed taxes within their municipal limits. However, the Mayor’s office has termed such charges ‘illegal’, claiming that they violate the Islamabad Local Government Act 2015.

Moreover, the IMC Mayor and Capital Development Authority (CDA) Chairman Sheik Anser Aziz has warned union councils to stop collecting taxes on their own.

Recently, Saidpur, UC-1 of IMC, had auctioned contracts for a cattle market in the area for Rs12.7 million. The move had also offended Aziz.

However, opposition members argued that the law did grant UC chairmen greater powers. “Yes, Saidpur UC awarded a contract of cattle market through an auction, which is permitted under the Islamabad Local Government Act,” the Opposition Leader in the IMC Ali Nawaz Awan told The Express Tribune. The Pakistan Tehreek-e-Insaf (PTI) leader said that UCs had a right to impose taxes which were not parallel to the ones imposed by the federal government.

A similar move was made by Sector I-10 UC Chairman Rana Ashfaq who recently imposed a professional tax in his area.

Awan further pointed out that Rawat UC Chairman Azhar Mehmood too had been collecting taxes for over a year, since the UCs were formed, and had generated considerable revenue. Moreover, Lohi Bher UC, following suit, had also issued a tender for a Sunday market on its own.

The need for UCs generating their own funds has been exacerbated by the fact that the federal government did not allocate any budget for the local government body in the capital. Instead, the CDA had to reserve funds for the IMC in its budget.

“The federal government did not allocate funds for the nascent local bodies for the second consecutive year and LG members have been left in the lurch,” Awan said, adding that after the elections, the people have great expectations from their cash-strapped LG representatives.

The opposition leader further lamented that the mayor was busy ‘enjoying’ his second post of CDA chairman. To make matters worse, he claimed that State Minister for Capital Administration and Development Division (CADD) Dr Tariq Fazal Chaudhry too has been lax in distributing discretionary funds even as residents of the capital continue to face acute water shortage, sewerage and other civic problems.

Following the examples of the Rawat union council, several UCs, particularly those in the rural areas of ICT, have started collecting toll taxes by setting up pickets on different roads. Shahdara UC set up a toll post on the road leading to the Shahdara picnic point to raise money.

Others have resorted to setting up cattle markets ahead of Eidul Azha in different areas. Some UCs have devised a way to generate revenue from the playgrounds.

However, some union councils including Soan and Bhara Kahu, have reportedly gone beyond their jurisdiction, collecting taxes which can only be imposed and collected by the IMC.

According to schedule four of the Islamabad Local Government Act 2015, union councils can collect taxes on birth and death certificates apart from those on projects which may have been completed by the UC itself including any water supply scheme, recreation festival or extravaganza.

Published in The Express Tribune, July 10^th, 2017.