Residential businesses on verge of collapse
View(s):Residences converted into business premises in local government authorities of Colombo and outside are on the verge of closing down amidst high service charges and commercial tax being levied by the authorities, businessmen complained.
Charges range from Rs. 150,000 to Rs. 500,000 per annum, they said.
They alleged that the Urban Development Authority (UDA) is taking action to allow the natural death of small businesses operating in residential areas by levying high service charges.
The aim of the UDA Amendment Act of 1982 was to discourage the mushrooming of commercial outlets through the conversion of residences into business premises but not to levy high service charges, a legal expert told Business Times.
He said that the responsibility of the UDA is to stop the unauthorized conversion of residences to business establishments but not to hit the existing, legal businesses (converted from residences) with high taxes and service charges.
In some instances the UDA is using power in an unjustifiable manner to levy charges from owners of residences whose houses had been converted to business establishments, an affected businessman said.
Businessmen point out that “if the authorities want to change the laws they ought to do it systematically. And that whatever these authorities choose to do ought to be done in a fair manner”.
According to a survey conducted by the UDA, there are many residences in Colombo that have been converted to business premises with proper approval.
In the Colombo suburbs too, the issue is the same. Business establishments are springing up in Battaramulla, Dehiwala and Mt. Lavinia as well, despite the existing residential area restrictions.
A senior official of the Dehiwala-Mt. Lavinia Municipal Council said that plans are normally approved by the planning committee of the local government institution, after it has received UDA approval only.
He said “it is possible to allow the construction of business premises in residential areas and the conversion of houses into business premises by paying the local authority a specified amount for the ‘change of use’.”
But the problem is that the local body has been deprived of carrying out all acts and incidental matters pertaining to planning and development regulation functions of the UDA, he said adding that it should be done under the direction and supervision of the UDA.
This was clearly indicated in the section 23 (5)0f the UDA Act, he revealed. The Act clearly permits local authorities to carry out the functions of the UDA under the supervision of the latter, which however is not happening now.
“The issues of residences converted into business premises in local government authoritative areas could be settled in a more prudent manner with the assistance of the local government authorities but it is not happening at present,” he alleged. According to a senior UDA official the procedure is to get UDA approval first and then reach the local authority for final sanction.
“While some owners of properties are allowed, under approval, to build residences cum shops or offices, there are others who don’t get this permission but operate commercial establishments in their homes. The UDA’s legal unit intends to take legal action against violators of the law,” he said.