KARACHI (HRNW): The “cash-starved” Karachi Metropolitan Corporation (KMC) is in a fix whether to print the Utility Tax in its bills to the consumers or not as the tax experts have warned it may lose even its legitimate revenue. Due to acute financial crisis, the KMC high ups ordered the printer to print arrears of Utility Tax, a tax imposed by former city nazim, Mustafa Kamal, “illegally and without any TORs”(terms of reference) on the bills being circulated to the Karachites.The residents of the city had rejected the “illegal tax”. Sources said, “Mustafa Kamal, who was heavily pampered by Pervez Musharaf had imposed most controversial tax to pocket some extra bucks by extorting Karachites on the pretext of completion of development projects.” It is pertinent to note that Pervez Musharaf had given Rs 300 billion to Mustafa Kamal for Karachi’s development, an amount that could have changed the dilapidated metropolis into one of the most modern cities in the world.
Interestingly, the private contractor has refused to print the “so-called” Utility Tax on the bills fearing he may lose the original revenue. The budget target of taxes was revised downward by Rs one billion, as the KMC could not meet the target after three years.
These taxes were meant for the development of the city, but the KMC could never meet the target.
Now the figure consumers have risen to Rs 1.365 million, out of which only 13,000 are paying taxes regularly. Most of taxes are being recovered from Central district on account of property registration and transfer of houses, flats, shops and industries.
“It is irony that KMC has miserably failed to collect even a single penny from 550 slums sprung up all around the city while some are located in heart of the city,” added sources. KMC officials claimed that these slums even have houses built by their owners as big as 1,000 square yards and their price ranges up to Rs 30 million each.
They said that almost 60 percent of citizens are residing in more than 550 slums who are not paying a single penny on account of any kind of tax. Not only that but almost all industrial areas including North Karachi, Federal B area, Landhi, Korangi, Orangi and SITE are also not paying municipal taxes.
Furthermore, the sources said that KMC should have received its due share from Motor Vehicle Tax from the Sindh government in order to complete its incomplete projects instead of trying to get peanuts through Utility Tax.
Municipal Services Director Khursheed Mukarram told Daily Times the KMC has outsourced taxes to a private company, which is printing and distributing bills and also collecting taxes through banks. But consumers are not paying bills.
He said there are 1.36 million consumers in the city but only a minimal 13,000 consumers are paying taxes.
“The provincial government has intervened in financial management that has paralysed KMC.
On the other hand, massive corruption and theft in revenue in most of the departments has also badly affected the revenues of Pakistan’s biggest civic body,” regretted sources.