The Greater Chennai Corporation (GCC) has significantly increased trade license fees for approximately 200 types of businesses, affecting small and large enterprises. This decision, made by the GCC council on 30 July 2024, is projected to boost the corporation’s revenue by about ₹100 crore. The fee hikes will impact around 75,000 establishments across various sectors in the city, categorized into four groups: micro, small, medium, and large.
For example, the annual license fee for marriage halls and banquet halls with a minimum area of 5,000 square feet has surged from ₹10,000 to ₹30,000. Lodging houses, guest houses, and service apartments, which previously did not incur a license fee, will now be required to pay ₹25,000 annually. The fees for manufacturing aluminium and brass vessels have been raised from ₹600 and ₹250, respectively, to ₹15,000 each. Saloons will now pay up to ₹10,000, up from ₹200, depending on their size. Beauty parlours, previously paying ₹500 annually, will see their fees increase to ₹6,000.
Significant changes also affect the hospitality sector. Guest houses, service apartments, mansions, and resorts will be charged ₹25,000 for spaces of 5,000 square feet, a notable increase from the previous zero-fee policy. For areas up to 1,000 square feet, the fee is set at ₹5,000 per year. Marriage halls will now pay ₹30,000 for spaces exceeding 5,000 square feet, up from ₹4,000. Small-scale eateries, including tea stalls and coffee shops, will see their fees rise from ₹2,500 to ₹5,000 for up to 1,000 square feet. For spaces larger than 5,000 square feet, the fee will be ₹15,000, up from ₹10,000. Restaurants will pay ₹15,000 regardless of space size.
Industry sources believe the new trade license fees won’t adversely affect customers but call for enhanced benefits from the corporation. M Ravi, owner of a major hotel chain and president of the Chennai Hotels Association, suggested that the fees could be collected every three years to ease the administrative burden. He also mentioned that while a new vehicle parking license fee is introduced, there was no relief from the police clearance requirement for hotel parking.
In the grooming sector, spas will face a license fee of ₹25,000, while salons will see increases ranging from ₹200 to ₹10,000. Beauty parlours will now pay between ₹500 and ₹6,000. C K Kumaravel, CEO of Natural Salons, welcomed the fee increase but requested clearer definitions for spas to avoid legal and police issues.
The GCC has categorized businesses based on turnover or land area, with small-scale shops now facing a minimum annual license fee of ₹3,000. Deputy Commissioner R. Laitha noted that enforcing 75,000 bills could be a substantial revenue source and emphasized the importance of timely renewals. The GCC has also introduced new rules for various types of businesses, with the commissioner now empowered to approve and cancel licenses. K R Shanmugam from the Madras School of Economics stated that the fee hikes are manageable compared to inflation and suggested further study of the impact on consumers.
Haircuts and groceries, and rent for marriage and banquet halls or even buying clothes or small electronic equipment are set to get costlier in the city, as Greater Chennai Corporation (GCC) has jacked up trade licence fees across the board. The move adopted by the GCC council on… pic.twitter.com/0OIvfe1UZD
— Omjasvin M D (@omjasvinMD) July 31, 2024
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