Despite HC orders, BMC sticks to old property tax proposal

The civic body on Tuesday tabled a proposal – for the second time in the last two years –reiterating its stand.

Two years after the Bombay high court asked the Brihanmumbai Municipal Corporation (BMC) to rework its property tax formula following 47 petitions by citizens, the civic body has stuck to the old calculations, which will result in taxpayers indirectly paying for their flat’s common areas like passageways and staircase i.e. built up area along with the carpet area of the house.

Bombay Municipal corporation headquarters in Mumbai. (HT File Photo)

The civic body on Tuesday tabled a proposal – for the second time in the last two years –reiterating its stand. The proposal takes into account the carpet area of the flat but multiplies this by 1.2, so the final cost remains equal to that of the built up area.

The administration claims that if it only considers the carpet area, it will incur an annual loss of nearly Rs 297 crore.

Earlier, the standing committee had rejected this formula at least twice and asked the civic body to reduce the citizens’ expense.

The BMC moved to capital value-based property tax system in 2010, leading to an overall hike in city properties. This system refers to the charging of tax on the basis of the capital value of the property, instead of the value of rent the property fetched. The new system considered the built up area of a flat instead of just the carpet area, besides other variables like age of the property and type of structure.

“The BJP might pass this proposal in the civic body to earn brownie points ahead of the elections. They will then ask the state government to disapprove it,” said Congress corporator, Asif Zakaria. Officials said the Advocate General of the state was consulted for the proposal.