The Sindh government on Wednesday unveiled its plan to collect two taxes on behalf of the Karachi Metropolitan Corporation (KMC) — fire tax and conservancy tax — from the citizens of Karachi through the monthly K-Electric bill.
The proposal was discussed in a meeting comprising officials of the power utility and municipal departments, chaired by Sindh Chief Minister Syed Murad Ali Shah.
According to a statement from the CM House, the meeting was convened to discuss the tax collection of the KMC and district municipal corporations through KE monthly bills.
The provincial chief executive said the rationale behind the move was to financially strengthen local government institutions. “We want to improve local tax collection,” he added.
Shah told the meeting that Rs100 and Rs200 will be charged respectively from two categories of consumers [to be carved by the provincial administration] in the KE bill.
He informed that the KE will charge the two taxes from its 2.56 million consumers.
“If formally signed, the agreement will help the KMC collect Rs9 billion annually,” Shah said, while recalling that the KMC currently collects Rs210m a year from the two taxes.
He insisted the initiative will strengthen and empower the KMC on the financial front to undertake development works without any obstacle.
The meeting was informed that the chief minister will reach out to the federal government for giving the KE legal cover to collect KMC taxes through its monthly billing.
Karachi Administrator Murtaza Wahab, who was also present in the meeting, said the plan would be a revolutionary one for the KMC.
“The KMC, which relies heavily on the Sindh government’s funding, will become financially independent once the decision is implemented,” said Wahab.
In February this year, the chief minister had also directed the Sindh Revenue Board to collect local taxes on behalf of the KMC to make it financially viable.
Shah had said the KMC had its petrol stations and it should auction them preferably to oil companies instead of giving them to individuals. “You have a lot of open plots at most valuable locations where the KMC can establish new filling stations, malls on public-private partnership mode,” the chief minister had said.