Hit hard by pandemic, retailers, traders seek waiver of property tax and license fee

Retailers, landlords and traders across the country are seeking waiver of property tax, renewal and license fees as well as reduction in fixed electricity and water charges from both the state as well as the central government.

Since April, nearly two dozen states including Maharashtra, Karnataka, Rajasthan, Chhattisgarh, West Bengal, Madhya Pradesh and Odisha, have restricted timings of shops selling essential goods to 4-5 hours a day.

A few states have shut down lifestyle, clothing and electronics retail completely.

The Federation of Retail Traders Welfare Association (FRTWA) in Maharashtra said in a petition filed in the Bombay High Court that retailers have faced heavy losses, financial instability and mass unemployment since last one year due to lockdown.

“By end of this month, there will be a 55-day period of continuous store closure and a loss of about Rs 70000 crore by the 13 lakh shops in Maharashtra alone. No relief has been offered to them since last year,” said Viren Shah, president, FRTWA, adding that the municipal corporation of Mumbai, Brihanmumbai Municipal Corporation BMC), should waive licence fees, property tax and other fees.

In the last year, retail has been one of the worst impacted segments and sales are lower than pre-covid levels despite reopening operations over the past nine months.

According to Retailers Association of India, the retail market shrunk 49% in the last two years due to the extended store closures.

Despite falling revenues, retailers must bear costs including salaries, rentals, electricity charges and various taxes and license fees.

“For the businesses to come back on track, everybody has to chip in. Landlords and tenants are working together to come out of this difficult situation. State governments should reduce property tax and other charges, while the central government should offer support by announcing measures if they want the market to sustain. We have written to the finance ministry and chief minister of every state for the same,” RAI’s chief executive officer, Kumar Rajagopalan, said.

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The industry body is also seeking an extension of renewals of existing permits and licenses for a year, relaxation in compliance requirements of retailers to pay MSME suppliers and a complete waiver to landlords and malls in payment of property tax for the year 2021-22 among other things.

“The government should announce relief measures suo moto instead of waiting for a list of demands. It is the government which announced the lockdown, so they must understand it is damaging to business,” said Sanjeev Mehra, president, Khan Market Traders Association of New Delhi.

In Delhi, the property tax is paid annually. The New Delhi Municipal Corporation, under which country’s most expensive markets – Khan Market and Connaught Place fall – collects taxes around September and October, while other three municipal corporations collect it in June.

“Business had not recovered fully before the second wave struck and disrupted business again. NDMC is even trying to increase the license fee by 10%, which is not justified at this juncture,” said Sanjeev Madan, president of Lajpat Nagar Market Association and member of Delhi Retail Forum.



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