Get ready to loosen your purse strings in 2015. If the Maharashtra government and the civic body have their way, you will end up paying up to 40% more as property tax and 8% on water charges.
The state government has decided to increase the ready reckoner rates by 15%, which will have a direct impact on the property tax you pay to the civic body.
The ready reckoner of an area determines the base value of the property — one of the factors used to calculate its capital value and thereby the tax to be paid under the new capital value-based system.
Apart from that, the Brihanmumbai Municipal Corporation (BMC) is also planning on independently revising property tax and water charges.
The BMC is in the process of revising the rules for fixation of capital value of lands and buildings in the city, which govern your property tax calculation.
This means the weightages assigned to factors such as construction type of your building, base value, floor number, user category, etc, which are used to calculate the capital value of your property might change, thereby affecting your tax bill amount.
The 40% cap on property tax will be applicable only to properties that are assessed before April 1, 2015, while no such limit on the hike will apply to new properties, which are yet to be assessed.
The revised tax rates will be applicable from April 1, 2015.
The 8% hike on your society’s water bill is likely to be effective from June. The first hike on water charges was introduced in 2012, followed by an 8%hike in June 2013.
The year 2014 was exempt from the hike on account of the Lok Sabha and the Vidhan Sabha elections.
“We are working on the rules to be adopted for property tax for 2015-2019. The decision to increase or decrease the multiplying factors is yet to be taken. The new rules will be finalised by the end of February and presented to the standing committee for approval,” said Milind Sawant, deputy municipal commissioner, in-charge of assessment and collection. “If the ready reckoner rates cause an exorbitant rise in taxes, we may work on a formula to neutralise that,” he said.
The capital value-based property tax rules is being contested in the Bombay high court, which is currently hearing 47 petitions on the issue.
Civic officials, however, said that the new rules will be framed keeping in mind the matters that are taken up in the high court.