Hyderabad: The Telangana government approved a one-time settlement (OTS) plan to clear pending property tax dues owed by government buildings to civic bodies, amid rising concerns over the GHMC debt burden.
Officials said the decision was taken after the Greater Hyderabad Municipal Corporation (GHMC) slipped from a cash-rich civic body with large fixed deposits into a debt-driven corporation over the past decade. Until 2013, GHMC reportedly maintained fixed deposits worth nearly Rs.1,000 crore. However, funds were later diverted to other departments after the formation of Telangana, leaving the civic body financially strained.
The civic body gradually moved from fixed deposits to overdrafts. Moreover, GHMC relied heavily on borrowings to execute major infrastructure projects, including flyovers. Officials said nearly Rs.6,000 crore was borrowed for such works. The outstanding liability currently stood at Rs.4,717 crore.
Reports recently suggested that the state government might take over GHMC loans. Officials also submitted loan-related details to the government. However, government sources clarified that the state was not ready to absorb the liabilities because it could affect Telangana’s borrowing limits.
Instead, the government decided to clear pending dues payable to civic bodies. As part of that exercise, the Cabinet approved the OTS proposal for government property tax arrears.
GHMC debt burden linked to pending government dues
Officials said property tax arrears related to central and state government buildings in GHMC, Cyberabad Municipal Corporation (CMC), and MMC areas under the CORE jurisdiction reached Rs.6,375 crore. Of this, arrears linked to the 2025-26 financial year stood at Rs.5,864 crore.
The Cabinet approved the OTS facility to help various government offices clear their pending taxes. Through the settlement scheme, the government expected the three corporations to receive nearly Rs.1,686 crore.
Authorities said total pending property tax dues across GHMC, CMC, and MMC areas stood at Rs.14,686.6 crore through 28,80,260 property tax assessments. Government buildings accounted for Rs.5,864 crore, while private properties contributed Rs.8,734 crore in pending dues.
Despite the large arrears, officials fixed a collection target of Rs.2,762 crore. By March 31, 2026, civic bodies collected Rs.2,558.80 crore.
Meanwhile, the early bird scheme implemented last month helped GHMC, CMC, and MMC collect Rs.1,211 crore. Among the three corporations, CMC topped the list with Rs.510 crore collections. GHMC followed with Rs.441 crore, while MMC collected Rs.260 crore.