Mumbai: Pay more property tax if new rule isn’t approved by Friday
As political parties squabble over aspects of the new formula to calculate property tax, civic officials have warned that the standing committee of the BMC must pass the formula by March 20.mumbai Updated: Mar 18, 2015 22:35 IST
As political parties squabble over aspects of the new formula to calculate property tax, civic officials have warned that the standing committee of the Brihanmumbai Municipal Corporation (BMC) must pass the formula by March 20. If they don’t, citizens will have to cough up more than what the new rule would have them pay.
After stiff opposition from the Congress, the Shiv Sena-BJP ruled standing committee is yet to pass the proposal for calculation of property tax.
Officials said that if the new formula is not passed by March 20, the bills will be issued on the basis of the old formula. Section 128 (A) of the MMC Act 1888 says that any tax that is to be levied on citizens for a particular financial year needs to be passed by the municipal corporation on or before March 20 of the year, in order to come into effect from April 1.
The Opposition at the BMC did not allow the ruling alliance to discuss the issue on Wednesday at the standing committee meeting, saying they needed more time to study the proposal.
If the new rule is implemented, Rs 578 crore will be generated through property tax. If the bills are calculated on the basis of the old formula, revenue of about Rs1,092 crore will be generated, earning the BMC a profit of Rs 514 crore.
Yashodhar Phanse, standing committee chairman, said, “The new rule will give some relief to Mumbaiites. If it is not passed in time, the residents will be burdened. We don’t want to burden the citizens with old rules that they will challenge again.”
Opposition leader Devendra Amberkar said, “We needed time to study the new rules to see if there are any loopholes and if there is any scope for improvement. We don’t want to be party to passing a rule that is appropriate. It was the BMC’s mistake to bring the proposal at the eleventh hour and then tell us to pass it, citing various rules and threatening that the delay will force citizens to pay more.”
RB Arote, assessor and collector for the BMC, said, “As per the law, we need to pass the proposal by March 20, and if that doesn’t happen, we have to apply the old rules that will burden the citizens. There are many relaxations in the new rules, which will be helpful to citizens.”
New formula for calculation of property tax
Capital value: Ready reckoner rate x User factor x Type of construction X Age of the building X Floor factor X Carpet area. The capital value is the basis for calculation of property tax.
If this rule is applied, civic body will earn revenue of about Rs578crore through property tax in the coming financial year
Old formula for calculation of property tax
Capital value: Ready Reckoner rate x Built-up Area (carpet area x 1.2) x User factor x Type of construction x Age of the building x Floor factor
If this rule is applied, civic body will earn revenue of about Rs1,092 crore through property tax in the coming financial year