Property Tax Collection in Mumbai Dropped by 34%
Property Tax in Mumbai
Almost 3-quarters down the fiscal, property tax collection in Mumbai displays a 34% shortfall compared to last year as the Brihanmumbai Municipal Corporation (BMC) has issued no residential bills in the middle of confusion over a waiver policy for homes under 500 sq.ft.
Property tax collection in Mumbai was Rs 1,637 crore till 13th December 2019, while last year BMC had collected Rs 2,495 crore till the same date.
Property tax in Mumbai is the largest revenue source for BMC. This year, tax collection has been executed only from commercial firms since the civic body has issued no residential property tax bills at all this year as it has not updated its software and other systems to reject living units under 500 sq.ft while making bills.
The software update has been kept waiting as there is a lack of clarity on whether residential units under 500 sq.ft are to be charged nothing at all or given only a base amount waiver while being asked to pay the other, smaller components of the bill like the various cess on it.
In a recent meeting with the new Chief Minister of Maharashtra Uddhav Thackeray, the civic administration flagged the issue of fund crisis at a time when the BMC plans to take up many big ticket-size projects such as Goregaon-Mulund Link Road and 29.2 km long Coastal Road project.
As per critics, BMC may not touch even half of property tax target
The Shiv Sena, the party which rules the BMC deliberative wing, and is headed by CM Uddhav Thackeray had in its 2017 civic poll manifesto promised property tax waiver for residential units under 500 sq.ft in area.
The BMC also drastically increased its collection target to Rs 8,300 crore this year from the Rs 5,000 crore it used to set itself before now. Critics are skeptical about the Municipal Administration reaching even half of its target.
BMC officials said that the corporation estimates around 4 lakh properties every year. Though the BMC would issue property tax bills amounting to over Rs 5,500 crore every year, the collection target used to be set at only about Rs 5,400 crore.
As outstanding property tax before the beginning of the fiscal was over Rs 10,000 crore, the collection target was improved this time.
A BMC official said, “This time our target for collection is estimated at Rs 8,300 crore keeping in mind the fact that Rs 10,000-crore plus is the outstanding property tax demand of every year that is carried forward on average and we should begin recovering it”
The pending software upgrade and delay in sending out bills were obstructing a significant revenue source, said Asif Zakeria, a Bandra Corporator.
It is expected that the collection will rise once the clarity on the waiver is achieved and bills are issued, said BMC official. They further said that many companies pay property tax in the last month. Therefore, the tax collection in March month always the highest.
The poor collection was due to offering rebates for garbage segregation by BMC, allocating large sums to the cash-strapped BEST Undertaking and commencing infra projects. “I am going to demand a financial white paper,” said Samajwadi Party Leader in the BMC Rais Shaikh.
How to calculate property tax in Mumbai?
The property tax is a % of the capital value of the property.
Property Tax = Tax rate * Capital Value
Here Capital Value = Rate of base value * Total carpet area/area of land in case of vacant land * building type * age factor * usage factor * floor factor
Property tax payment due date and penalty
Due Date: 30th June
Penalty: It is charged at 2% per month in case of a delay in payment beyond the due date on the outstanding amount.
How to pay property tax in Mumbai?
Property tax can be paid both online and offline.
Online payment
BMC/MCGM
- Visit BMC online portal i.e. https://portal.mcgm.gov.in/irj/portal/anonymous
- Under the “Online Services” tab click on “Pay Property Tax”
- Enter your property account number and choose whether you need to view “outstanding bills” or view “receipts” or “make payment” and click accordingly
Navi Mumbai/NMMC
- Visit NMMC online portal i.e. https://www.nmmc.gov.in/navimumbai/
- Under “Online Service” click on “Property” and enter you “Property Code” and click “Search”
Offline Payment
If you want to pay manually, it can be paid at the nearest assistant revenue office or BMC helps centers or citizen facilitation centers at all ward offices.
Who are applicable to get concession/exemption on payment of property tax?
- Flats/houses measuring less than 500 sq.ft are exempt from payment of property tax.
- A concession of 60% for houses/flats measuring between 500 to 700 sq.ft.
- Property particularly used for public worship/charitable purposes.
- Properties belong to the Diplomatic or Consular Mission of a foreign state as specified by the government.
