Tax on vacant plots to help Indian urban poor

---

NEW DELHI, (Internet) The centre is considering a tax on unused urban land to finance a national fund for urban poor to ensure that basic services - shelter, water, sanitation and health facilities - reach the poorest. brGovernment sources pointed out that the tax would be paid by individuals, institutions and builders who are allotted land by a government agency but keep it vacant instead of using it for the stated purpose. The proposed tax will be calculated at the prevailing market rate. To bring in more money, the government also proposes to give tax exemptions to contributors.brBesides helping finance projects for the poor, the tax is intended to deter speculation by builders and developers who exploit the scarcity of land in cities and towns. brSources pointed out that the corpus, called basic services to urban poor fund, will have an initial input of around Rs 50 billion and will also get a grant from the centre. According to the proposal moved by the housing and urban poverty alleviation ministry, the non-lapsable fund will be set up at national, state and city levels. brThe purpose of the revolving fund, being pushed vigorously by minister of state for housing and urban poverty alleviation, Kumari Selja, is to finance the integrated development of slums through projects for providing shelter, basic services and other related civic amenities. brThe government proposal also suggests that civic agencies spend 25 per cent of their budget in areas dominated by the urban poor if they want to avail of central assistance from the revolving fund. brA similar rider will apply to civic agencies funded by Jawaharlal Nehru Urban Renewal Mission. brPoor constitute a major chunk of the urban population. According to the government's estimates, in Mumbai, slum-dwellers constitute 54.1 per cent of the city's population. The figure for Delhi is 18.7 per cent. The proportion increases in smaller towns.