In the civic budget for this year, BMC municipal commissioner Sitaram Kunte made no big-ticket announcements, but hinted at the possibility of new taxes that will be levied in Mumbai.
There are no big-ticket projects planned in this year’s civic budget. What is your vision for presenting the budget in this direction?
There are important projects such as the coastal road, the Goregaon-Mulund Link Road (GMLR) and a power generation project in the Middle Vaitarna Dam. We have focused on better implementation of projects and the emphasis is on providing quality services to citizens.
In a major transition, the octroi tax (largest source of revenue) will be abolished and Goods and Services Tax (GST) could be introduced from April 2016. How is this being planned? How will it affect the BMC’s revenue?
With the introduction of the GST, the BMC will lose approximately Rs 8,100 crore. Departments such as solid waste management, storm water drains, education and road work will be affected. As there is no clarity on the state’s mechanism to offset the revenue loss, we are planning to increase existing taxes and introduce new ones, such as a transport tax, waste management taxes and property taxes on slums. We are also pressing the state to handover professional tax to the civic body.
How will you get these taxes approved, especially because the BJP, in power at the Centre and state, has objected to them?
It is never easy to introduce new taxes, but we have just one year to prepare a new model. We will not have the luxury of the octroi to fall back on, thus the transition is necessary and needs consideration.
How will the civic body fund the coastal road and GMLR projects, if it fears revenue loss after GST?
The coastal road and the GMLR will be funded by revenue from premium on fungible FSI. So, abolition of octroi will not directly impact them.