Mumbai: Ahead of BMC polls, Mayor Kishori Pednekar says no 14% hike in property tax
Mumbai: Ahead of BMC polls, Mayor Kishori Pednekar says no 14% hike in property tax
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With civic elections looming on the horizon, the Shiv Sena-ruled Brihanmumbai Municipal Corporation has ruled out the 14 per cent hike in property tax that had been proposed by the administration in the current fiscal. Mayor Kishori Pednekar announced on Thursday, “There will be no 14 per cent hike in property tax – a proposal pending with the standing committee for approval. It won’t happen, as the coronavirus pandemic crisis is not yet over, though there has been dip in cases in Mumbai.”

Pednekar’s announcement comes a day after the standing committee postponed the property tax hike proposal till the next meeting, following opposition from the Congress and the BJP. The opposition parties argued that the increase would adversely impact the common citizen who was already reeling under the coronavirus-induced lockdown and the resulting slowdown in the economy.

Further, Pednekar’s announcement is significant, given that the Shiv Sena, which has expressed its resolve to retain power in the civic body notwithstanding the BJP’s Mission 2022, has reached out to tenants from lower and middle class by opposing the Model Tenancy Act recently cleared by the Union Cabinet.

The administration had proposed an increase in property tax of 14 per cent up to 2025, with the projection of additional mobilisation of Rs 1,000 crore during the current fiscal.
The BMC had hiked property taxes in 2015 and another increase was due in 2020 but the pandemic outbreak stymied this move. The BMC uses the capital value system (CVS) to calculate property tax, based on the market value of the property.

The civic body, currently engaged in Covid management, is simultaneously pursuing a slew of infrastructure development projects, including the Mumbai Coastal Road and the Goregaon-Mulund Link Road and has set an ambitious target of Rs 7,000 crore for property tax collection in its 2021-22 budget. It had set a target of Rs 6,768 crore for 2020-21 but could not meet it because of the slowdown in the economy.

In addition, the BMC is struggling to recover long-pending property tax dues of over Rs 16,000 crore from various state government departments and the slum rehabilitation department, to meet its fund requirements.

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