The Hindu Business Line : AP proposes hike in development charges on land

The development charges on land are proposed to be hiked by the Andhra Pradesh Government, after nearly 10 years, in a focused bid to generate higher revenues for the Urban Development Authorities (UDAs) to provide better infrastructure.

The proposed new charges would be Rs 300 per sq.m. in the case of development of land and Rs 125 per sq.m. in the case of buildings. The necessary amendments to the Section 28 of the AP Urban Development Act 1975 have been made.

The Section 28 of the UDA Act stipulates that the development charges shall not exceed Rs 125 per sq.m. in the case of land development and Rs 40 per sq.m. in the case of buildings. These rates were also fixed in 1996.

The objective of bringing in the Amendment is to meet the future requirements of urban development. It would not lead to an immediate increase in the rates of development charges and the proposal is only to make an enabling provision in the Act so that in future differential rates of development charges for different parts of the UDA areas can be levied depending on the cost of infrastructure to be provided by the UDAs, according to an official press release.

The State Government is planning to place the necessary Bill in the ensuing session of the Legislative Assembly for consideration and approval.

While the present real estate boom has seen a sudden and huge jump in real estate values in cities like Hyderabad, over the past 10 years, the land value has appreciated more than 10 times, especially in the Hyderabad Urban Development Authority (HUDA) areas.

UDAs have the mandate to implement various city-level infrastructure projects like formation of Master Plan roads, link roads, development of city level parks, flyovers etc. To implement these projects it needs to improve the financial position. Development charges are the only source of income for these UDAs.

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