BMC proposes tax relief for Mumbai small property owners
21 March 2015
There is likely to be some relief for those who own properties that measure 500 sqft or less in Mumbai, as The Brihanmumbai Municipal Corporation's general body on Friday passed a proposal that exempts such housing owners from the capital value-based system of calculating property tax.
The new proposal by the country's richest civic body allows such home-owners to continue paying tax according to the flat's rateable value. There are about eight lakh properties that fall in this category.
The proposal will be sent to the state government for approval.
Former mayor and Shiv Sena MLA Sunil Prabhu had written to the chief minister against including such properties in the capital value system.
''I have taken up this issue with the chief minister and there was positive response from his end, so there will be stay on including them in the capital value system,'' Prabhu said.
The suggestion was put forward by leader of the house Trushna Vishwasrao and was passed by the general body of the BMC.
''We need to exempt these property owners from paying more. The BMC is not here to make profits and it needs to be approved at the earliest,'' Vishwasrao said.
These properties would have ended up paying the BMC around Rs150 crore.
The civic standing committee on Thursday cleared a proposal to hike property tax in the city by an average 14.52 per cent including 11.74 per cent for residential properties. According to the proposal, properties measuring 500 sqft or less were to come under the ambit of the capital value based system. When the civic body switched to the capital value based property tax system from the rateable value system in 2010, small flat owners had not been included in the switch.
Now, in order for that exemption to continue, the state government will have to make relevant amendments in the Mumbai Municipal Corporation Act.
However, BMC officials said they will continue to bill these property owners according to their capital value, until the approval or stay comes from the state government. Sources said the state government, too, was in favour of exemption.
R B Arote, assessor and collector, said, ''We will have to bill every one according to the new rules, unless the state government amends the Act or stays their inclusion in the capital value system.''