Maharashtra cabinet abolishes colonial non-agricultural tax, but confusion prevails among housing societies

Non-agricultural (NA) tax, a legacy of British-era law, was historically levied on properties built on agricultural land within municipal limits

Nearly a year after the Maharashtra cabinet decided to abolish the non-agricultural (NA) tax on urban residential units, housing societies across the state remain uncertain due to the absence of a formal Government Resolution (GR). The lack of official communication has left over one lakh housing societies in limbo.

Nearly a year after the Maharashtra cabinet decided to abolish the non-agricultural (NA) tax on urban residential units, housing societies across the state remain uncertain due to the absence of a formal Government Resolution (GR). (Representational photo) (Pixabay)

The issue recently resurfaced as several societies in Mumbai and Pune received NA tax notices, sparking confusion among residents who believed the tax had already been scrapped.

What is the NA tax?

NA tax, a colonial-era levy, is imposed on properties developed on agricultural land within municipal limits, excluding designated gaothan areas. The October 2024 cabinet decision sought to eliminate this outdated tax, especially since residents already pay property tax on the same land.

"Our society received a notice from the authorities of the local talathi office saying that our society's land is marked as agricultural land and that we should provide documents to prove that it can be converted into NA land. However, we went and questioned the authorities about how it matters when the NA tax has been abolished?" said a secretary of a housing society in Mumbai's Western Suburbs.

The implementation of the cabinet decision is unclear, as no formal GR has been issued by the government. This has created a scenario in which some societies have halted payments, while others continue to pay to avoid potential penalties.

According to Maharashtra government officials, the state government is likely to issue a GR in the coming days, which will help resolve the confusion surrounding NA tax.

What other taxes do housing societies pay?

Besides NA tax, housing societies in Maharashtra pay water tax, property tax, and electricity charges, among others. Of the 1.2 lakh housing societies in the state, the majority are concentrated in the Mumbai, Pune, Nashik, and Nagpur metropolitan regions.