The merger of 20 municipalities and seven corporations into the Greater Hyderabad Municipal Corporation (GHMC) will present several conundrums to the corporation and the government.
While the government projects uneven development patterns, regulatory disparities and increasing urbanization pressures in suburban areas as reasons for consolidation, solving some of these problems may not be a piece of cake. For example, a difference in property tax calculation could be a problem in enforcing uniformity across circles. As part of the property tax reforms promoted by the central government, several former municipalities and corporations adopted the value of the property as the basis for calculating the tax against the plinth area of the property. The current tax rates are said to be between 0.12-0.2% of the registered market value of properties across the former ULBs.
Annual rental value (ARV) tax is still levied under the GHMC’s purview, for the calculation of which plinth area is the basis. A constant of ₹ 1 per sq ft has been fixed for ARV calculation for residential properties in all circles except Jubilee Hills and Banjara Hills where the benchmark is ₹ 1.25 per sft. ARV for three months combined with library is charged as property tax here.
Due to this disparity, the property tax in corporations like Nizampet is much higher than in GHMC, while the facilities provided are not even comparable. If uniformity is to be enforced, the GHMC must work out a formula to bring the newly annexed areas at par with the GHMC in terms of taxation.
Enforcing the GHMC criterion across the board is not feasible now as the corporations where the wealth tax reforms have been implemented have already availed the concessions from the center in return. The push for reforms in GHMC could have negative consequences for the government in the upcoming GHMC elections. The officials, speaking on condition of anonymity, believe that the government may not want to disturb its apple basket at this time and is therefore likely to maintain the status quo.
Another challenge could be the introduction of a 20 kilometer program of free drinking water for households. The scheme was introduced by the erstwhile BRS government to fulfill its promise to city residents ahead of the 2020 GHMC elections that domestic drinking water up to 20,000 liters would be free. This scheme did not apply to consumers in peripheral municipalities/corporations drawing water from Hyderabad Metropolitan Water Supply & Sewerage Board. It remains to be seen whether the government will extend the scheme to all the newly added circles in the name of fairness and justice.
Published – 04 Dec 2025 20:31 IST
