Tax imposed on unauthorised structure in slum does not legalise it: BMC

The Brihanmumbai Municipal Corporation (BMC) on Thursday decided to impose property tax on all commercial establishments in slum areas but categorically stated that the imposition of the tax will not legalise the unauthorised structures

MUMBAI: The Brihanmumbai Municipal Corporation (BMC) on Thursday decided to impose property tax on all commercial establishments in slum areas but categorically stated that the imposition of the tax will not legalise the unauthorised structures.

Tax imposed on unauthorised structure in slum does not legalise it: BMC

The assessment and collection department has begun the survey process as part of this tax levy. Under the Mumbai Municipal Corporation Act of 1888, tax is levied on lands, buildings (both raw and concrete), and other properties within the BMC’s jurisdiction, with regular tax collection.

The decision to extend property tax to previously untaxed commercial establishments in slum areas stems from the fact that the city has around 2.5 lakh slums, of which approximately 20% (about 50,000 slums) are used for commercial purposes, including small and large industries, shops, godowns, and hotels.

Bhushan Gagrani, civic chief and administrator, in his budget speech on February 4 had said that an additional revenue of ₹350 crore is expected in 2025-26 from property tax on commercial establishments in slums. Since these establishments benefit from infrastructure services provided by the BMC, assessing and collecting property tax from them has become necessary, he said.

Some citizens have raised objections on the grounds that by levying property tax on these commercial establishments, the BMC is legalising the unauthorised structures.

The BMC, however, clarified that, as per Section 152(A) of the Mumbai Municipal Corporation Act of 1888, “if any building or part of a building has been constructed or reconstructed illegally and tax or penalty has been levied on it by the administration, it does not mean that the said construction or reconstruction is legalised.”