Licence fee revenue from ads crosses Rs 1cr in less than a year

Thiruvananthapuram: GST might have shrunken the tax reserves of city corporation, however the revenue wing managed to collect more than Rs 1 crore as consent and licence fee for advertisement hoardings in the city.
The civic body collected Rs 1.30 crore since May 2018 as consent and licence fee for advertisement hoardings in the city, which is double the amount which used to be collected by corporation as advertisement tax.

The finance standing committee had introduced licence fee for temporary advertisements like flex boards, banners, sunpack boards, arches, vehicle advertisements and wall endorsements through an agenda presented in the council meeting held in May 2018. The committee also engaged a private agency for collection of licence fee by opening up the process for auction. An amount of Rs 9.5 lakh was fixed as auction amount.

“We used relevant sections of Municipality Act to collect licence fee. We had to make up for the loss incurred by the city corporation after GST was introduced. Licence fee and arrears were collected with the help of a private agency, which was chosen through auction process,” said a revenue official with the city corporation.

Even in 2017-18, corporation could barely collect Rs 50 lakh as advertisement tax, however since May 2018 corporation crossed Rs 1 crore in less than 12 months. The agreement with the agency was made for the period between June 1, 2018 to March 31, 2019. The consent fee, which is collected based on dimensions and nature of advertisements, is also set to increase marginally very soon.

The city corporation officials said that the collection of arrears was crucial in stepping up income through licence fee of hoardings. “Many of the hoardings, which had been erected without any authorization, were slapped with huge fines. The agency which erected one advertisement hoarding at Vazhuthacaud, which was found to be illegal, had to pay corporation Rs 3 lakh,” said the corporation official. The city corporation had collected over Rs 6 lakh as penalty from unauthorized hoardings.

The new bylaw, which has been prepared by the revenue wing, has mooted 1% interest as penalty for those who fail to renew licence by April of every year. The issuance of licence begins in February and licence fee has to be paid by April. The boards shall clearly display sticker issued by corporation, ID number, name of the agency, telephone number, dimensions of the board and duration of licence. Three kinds of fees namely; scrutiny fee, licence fee and permit fee will be levied from applicants as per the new by law. Structural stability certificate will be mandatory for ad hoardings measuring above 12 sqm and it should have insurance coverage as well. In case of any accidents occurring due to fall of advertisement hoardings, the licensee will bear the complete responsibility and he/she will be liable to provide compensation for the victims.

The bylaw also mandates specific distance norms for erecting advertisement hoardings. All kinds of boards and hoardings shall be erected at a distance of 1.5km from public path and the city corporation will mandate distance to be complied with while erecting boards near buildings.