Mumbai: BMC Strives To Reach ₹6,000 Crore Property Tax Target As Revenue Hits 10% Mark

Mumbai: BMC Strives To Reach ₹6,000 Crore Property Tax Target As Revenue Hits 10% Mark

Due to legal complexities in the BMC's retrospective tax assessment, the civic body recently initiated the distribution of bills to taxpayers.

SHEFALI PARAB-PANDITUpdated: Monday, January 01, 2024, 09:55 PM IST
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Mumbai: The BMC has generated Rs 638 crores in revenue from April 1 to December 31, 2023. This amount represents only 10 per cent of the estimated property tax for the fiscal year 2023-24. Due to legal complexities in the BMC's retrospective tax assessment, the civic body recently initiated the distribution of bills to taxpayers. Consequently, achieving the target of Rs. 6,000 crores in the next three months (till March 31) will pose a challenge for civic officials.

Decline in revenue collections

Property tax stands as the second-highest revenue source for the municipal corporation. According to civic sources, the BMC has experienced a decline in revenue collection over the last two years. The exemption of property tax for residential properties up to 500 sq ft led to a loss of Rs 462 crore. Additionally, the revision in tax due in 2020-21 was deferred because of the pandemic, extending until 2023, resulting in a revenue decrease of Rs 1,080 crores. Consequently, the civic body revised the target of property tax collection from Rs 7,000 crore to Rs 4,800 crore in 2022-23. Despite this, the assessor and collection department surpassed the target, collecting Rs. 5,575 crores by identifying major defaulters and persuading them to settle their dues, as per civic sources.

Distribution of property tax bills after a 9-month delay

For the financial year 2023-24, the civic body has commenced the distribution of property tax bills after a nine-month delay. The bills, recently published on the BMC's website with a 15 to 20 per cent increase, faced objections from taxpayers and former corporators. In response, Municipal Commissioner Iqbal Singh Chahal clarified it as confusion among citizens, affirming no hike in property tax for the current fiscal year. Taxpayers will receive two provisional bills between April 1 to September 30, 2023, and October 1, 2023, to March 31, 2024.

"The provisional bills will be equivalent to the amount payable in 2022-23. Taxpayers must settle the first bill (April 1 to September 30) by January 15. The remaining six-month bill (October 1 to March 31, 2024) needs to be paid by March 25, 2024. Last year, the BMC collected Rs 3,550 crores between April 1 to December 31, 2022. This year, the Rs 638 crores collected in the last nine months pertains to arrears from previous years. We are optimistic about achieving the target in the last three months," stated a senior civic official.

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