With a slowdown in construction activity and requests from builders’ associations, the municipal administration and urban development (MA&UD) is considering reducing impact fee. The Greater Hyderabad Municipal Corporation (GHMC) and Hyderabad Metropolitan Development Authority (HMDA) are collecting impact fee from builders, especially the ones who build structures above five floors and commercial buildings, as such construction would put more burden on infrastructure.

After the new building rules were issued under GO 86 in 2006, the MA&UD introduced the impact fee in the city. As per the rules, a builder constructing a 15-floor building has to pay Rs 20 crore including impact fee either to GHMC or HMDA. The real estate builders claim it has become a burden to take up big projects coming up in over 10 acres. Apart from this, the city-level impact fee is being collected by the GHMC for constructing commercial buildings, shopping malls and multiplexes in core areas of the city. The impact fee is collected from builders apart from other permission fee.

The builders’ associations are also demanding that fee be collected based on the number of floors instead of the height of buildings. IT firms seek fourmetres per floor instead of normal three for false ceiling and AC ducts. The Builders Forum has asked the government to reduce the impact fee and collect it after completion of the building as the impact (burden) on the infrastructure will be after completion of the building or collect the fee in instalments,” Builders Forum president C Sekhar Reddy told TOI. “The state government will take a decision on the impact fee in a week,” an official said. The city impact fee was enhanced last year by grading the 61 commercial roads into A, B and C categories based on the width and traffic flow on it.

GHMC has been collecting Rs 400 per square feet (sft) on total built-up area in category ‘A’ roads, Rs 300 in ‘B’ roads and Rs 200 in ‘C’ roads apart from the city-level impact fee that is being collected by the GHMC for giving building permissions. If a builder or owner wants to construct ‘A’ category buildings on ‘B’ category roads, they have to pay three times the impact fee instead of what is charged in category ‘B’ roads. Similarly, if builders want to construct ‘B’ category buildings in ‘C’ category roads, they have to pay three times more impact fee.

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