Do heritage and religious sites have capital values like office buildings and residential apartments? The capital value of a property is the amount it can fetch when it is sold in the open market. The new property tax system announced by the municipal corporation has placed a market value on the city’s temples; mosques and churches, shocking the pious who believe that their shrines are forever, and thus not for sale.
Recently, the trust that manages the two-century old Jama Masjid in Zaveri Bazaar received notices from the municipal corporation asking them to pay property taxes on the capital value of the premises. The Bhikha Behram Well in Churchgate, which was built in the eighteenth century, has been asked to pay taxes based on its property value. Based on the taxes that the trust has been asked to pay, one lawyer from the Parsi community has estimated that the well must have been valued at Rs1 crore. “How do you assign a rateable (open market) value to a property that is centuries old?” asks Hanif Nalkhande of the trust that manages Jama Masjid.
While the new property tax rates have generated protests, religious trusts feel they are bearing the brunt of the new tax regime. The tax has especially alarmed Parsi trusts that run religious and charity institutions on premises that may now be valued at tens of crores rupees but with incomes that are just a fraction of the property’s capital values. A fire temple in Princess Street estimates that under the new rules, its annual property tax commitments will rise from Rs12,000 under to Rs60 lakh.
Property tax rules usually spare religious places but if some part of the premises is rented out, the religious trusts do not get the benefit of exemption. The reason why many Parsi fire temples have been asked to pay the exorbitant taxes is because many of them have shops selling sandalwood and religious supplies in their premises. Some temples also own residential premises that have been rented out. The trust running Jama Masjid too has properties that are rented out. The trusts say that they need these sources of income to offset the cost of running the religious institutions.
The Don Bosco Society that manages the Don Bosco shrine in Wadala and educational institutions in three different locations in the city has been asked to pay revised taxes as they run ‘commercial’ activities on these premises. The group has filed a complaint at the local municipal ward office. “The hike in taxes is substantial. We have been told that we are running commercial institutions; this is not true,” said Father Michael Fernandes, head of the Don Bosco Society’s Mumbai unit.
Some trusts have decided to pay the new taxes. “We have taken a conscious decision to pay. They had not increased property taxes for a long time,” said a member of a prominent Hindu temple in Matunga.
But religious trusts which feel that the new rates are unfair have decided to unite in opposition. “We have submitted our objections and are expecting the Property Owners Associations, of which we are members, to take up the issue,” said Nalkhande.
A member of parish council of St Andrew’s Church in Bandra said that they have filed an appeal against the new tax. The Parsis have created a group to protect their religious institutions that is planning to file a writ petition again the new tax rules. Other groups like the Bombay Catholic Sabha are expected to join.