Nashik Municipal Corporation’s (NMC) Commissioner Manisha Khatri has finally fulfilled her promise as per the provisions of the budget and has reduced the rent on tenants in residential, non-residential and industrial sectors from April 1. Now tenants will have to pay 30% more tax, not double-triple of the prevailing taxable value rate. The administration is confident that this will curb the concealment of income by tenants, and will also increase the NMC’s revenue.
Under the NMC’s area, the taxable value of property tax was earlier determined on the amount mentioned in the agreement regarding the lease income before 2006-07.
Big benefit for non-residential sector
Tenants in non-residential sectors were being charged triple the rent. Now if one rents a plot of 1,000 sq ft, they will have to pay Rs 57,164 in rent, assuming a valuation rate of Rs 68 per sq metre. Earlier, the annual rent for the same area was Rs 1,33,495 at Rs 158 per sq metre. With this decision, the tenant will get a discount of Rs 76,000 annually. Khatri has made this decision after receiving feedback from the construction industry associations.
The process of determining the lease was underway. From April 1, 2006, the taxable value of the lease was determined at double the taxable value for residential income and triple the taxable value for non-residential income, taking into account the prevailing taxable value in the area. However, due to this, the tenants had to pay double or triple the rent.
The information about the residence of the tenants was hidden in the income. As a result, the NMC was losing revenue. Therefore, Khatri has decided to change the taxation policy by considering a 30% higher assessment rate on the prevailing taxable values fixed in the relevant areas for the lease period of residential, non-residential and industrial properties from April 1, 2025.
“With the new decision, the income of the tenants will not be hidden. The tenants will come forward to register their income on their own. This will increase the revenue of the NMC,” said Deputy Commissioner (Tax) Ajit Nikat.
It has been decided to determine the taxable value and charge house rent accordingly. On such lands and buildings, which do not inform the NMC in writing about the use of their income on a lease, a penalty of 50% of the annual demand for one year as per the taxable value fixed on the lease will be levied.
