KARACHI, Feb 12: Oblivious to the growing opposition to the city government’s decision to levy a huge infrastructure tax, the District Coordinator Officer (DCO) said on Thursday that the government would not retreat on the issue considering that it had no other way to raise funds.

“Our resources have started shrinking, but we need money to initiate and maintain development projects, for which we are now charging the citizens of Karachi holding residential, industrial, commercial and amenity plots,” remarked DCO Javed Hanif Khan while speaking to newsmen in his office.

He maintained that the CDGK was well within its rights to collect fees from citizens and vowed that the government would definitely fight the persons or group challenging it on the issue in a court of law.

Responding to a question, Mr Khan said that he or his administration was not interested in knowing if any other district or city government in the province or country had imposed the infrastructure fees on its population.

“We are convinced that we have levied the tax correctly for the betterment of the city and provision of services to the people and we will not mind if anybody moves the court as well,” he added.

He said that the city government had estimated that it would raise an amount of Rs2.5 billion in the first year through the tax, which was progressive in nature. He said the bills were being distributed to between one and 1.2 million units currently in the tax network, and added that the network would expand when more field work and surveys were done.

He said that the revenue, which the government had planned to generate in the name of public utility charges, solid waste management and citizens’ contribution to ongoing or new projects of public interest, would, however, not be diverted to the Union Councils at any stage.

While observing that the recovery of fees already imposed on citizens against water and sanitation services or fire and conservancy taxes had not been up to the mark for several reasons, the DCO said the CDGK would take action against under the Land Revenue Act to ensure that this infrastructure tax was paid.

The CDGK was faced with a financial crunch due to the overall investment situation in the country and restrictions in the flow of finances and grants from the provincial and federal governments. The CDGK, which in the past had sold its lands to generate revenue, was now not getting the appropriate prices for its plots due to the prevailing crisis in the real estate sector, he added.

“It should be appreciated by all that the city district government of Karachi wanted to undertake more development programmes in the city and that was why it opted to levy taxes and not rely upon the provincial or federal government only.

“To overcome the financial crisis the CDGK has already cut non-developmental expenditures by 25 per cent,” he said.

Responding to another question, he said that to avert the duplication of taxes, the CDGK had already instructed the KWSB to stop collecting the conservancy and fire taxes from its consumers on behalf of the city government.

On the issue of the government’s failure to develop the infrastructure for collection, transfer and final disposal and treatment of municipal solid waste in Karachi, DCO Khan said that it was unfortunate that the Chinese firm engaged for the purpose had been failing to deliver in line with the Memorandum of Understanding and relevant agreements, and that this was why the CDGK had now decided to give (another) legal notice to the firm in question to fulfil its obligations. If it did not, he said, the government would look for alternative solutions to the solid waste management problem.

Interestingly, while the CDGK has issued bills to consumers for payment of the disputed infrastructure tax for a period from January to March, 2009, citizens have reported that the KWSB continued billing them against the conservancy and fire tax in February as well. Such developments very clearly indicate that the CDGK machinery for bill collection was being mismanaged, said a couple of senior citizens.

The municipal services department of the City District Government Karachi has, without issuing any intimation to citizens, begun to send bills to holders of plots measuring from 40 sq yards to 1,000 sq yards, and to owners of industrial, commercial and amenity lands, for using its infrastructure (ie roads, bridges, flyovers, parks, underpasses) and also for benefiting from public lights.

The tax is also being charged for use of the CDGK’s solid waste management system, despite the fact that the city government has been unable to implement this system.

Citizens of the metropolis feel the government is unjustly charging an exorbitant tax and that the levy will further burden the people of the city. Opposition parties in the city council have opposed the tax, and citizens have expressed disappointment with the Muttahida Qaumi Movement-led city government for levying the tax.