GHMC to revise trade licence fee calculation

The Greater Hyderabad Municipal Corporation (GHMC) plans to increase its revenues this year by doing away with the maximum ceiling for trade licence fee calculation and collection, appears to have been impacted by the coronavirus pandemic and the subsequent lockdown. 

As part of various options explored to make its coffers more comfortable, the civic body had revised the tax fee. However, the events resulting from the Covid-19 pandemic have cast a shadow on the plan.

Earlier, the municipal corporation used to calculate and collect trade licence fee from an outlet with a maximum ceiling of about Rs 2 lakh per outlet. This was resulting in meager fee collection for the municipal corporation as irrespective of the outlet’s size, including malls, there was a maximum ceiling. 

Considering these factors, the GHMC removed the maximum ceiling and come up with the method of calculating trade licence fee based on the road width, area of the outlet and the locality it is being operated.

Accordingly, the trade fee licence for outlets operating on a single lane road width is Rs 3 per square feet, for those operating on a double lane road it is Rs 4



per square feet and for those operating on more than two lanes, it is Rs 6 per square feet. 

Currently, there are over 15 lakh structures, which are assessed for property tax in the city. Of these, nearly 2 lakh structures are identified as commercial buildings. Interestingly, only 70,000 establishments have obtained trade licence from the municipal corporation.

As a result, the municipal corporation has not been generating much revenue through trade licence fee. This year, 18,989 new applications were filed and 30,834 were renewed, and the municipal corporation collected nearly Rs 40 crore and another Rs 30 crore is yet to be collected, said a senior official from GHMC.

“Due to the lockdown imposed last year, many outlets have shut their operations, citing losses. This could affect the licence fee collections,” the official said. To make the process of seeking trade licences easier, the GHMC is offering the facility of applying for the licence either online or at facilities such as e-Seva centres, citizen services centres and circle offices. The GHMC authorities have also introduced self-declaration for obtaining trade licence online.