Indian Express 15.06.2010
Property tax bills this month, calculated old style
sharvaripatwa Tags : property tax bills Posted: Tue Jun 15 2010, 02:47 hrs
Mumbai: The BMC is likely to start dispatching this year’s property tax bills in June based on the old, rateable value-based assessment system rather than the planned, new one based on capital value. The property tax department had not sent the bills in April, as the mandate had been to usher in the new tax regime this year.
The cash-starved department has forwarded a proposal asking to be allowed to send bills according to the old system, said a senior official.The proposal has been approved by the Municipal Commissioner, he added, and is now awaiting the final nod from the state urban development department (UDD). The new system is being put in place but will take some time while computation systems are finalised.
“Once the new system is in place, we will bill the property owners for the difference between the old and the new systems. In some cases, people might have to pay more; in others the BMC might have to refund some money,” the official said.
“We need the money to fund other projects. Once the proposal is passed, we will start dispatching the bills according to the old system. The department hopes to collect about Rs 1,000 crore in the next two months,” the official said.
The new system will be based on the actual market value of property. The figure will be based on the stamp duty ready reckoner, which the government brings out every year. Older buildings will get a concession for depreciation.
The rateable-value-based system followed now had been introduced in 1888 by the BMC Act. Citizens are charged according to the rental values of their property. As a result, most properties in South Mumbai, where rents are low thanks to the Rent Control Act, entail taxes lower than properties in the suburbs.
The new system, which officials hope to implement by October, is expected to swell the BMC kitty by 25 per cent. The collection target for 2010-2011 is Rs 2,800 crore
The official said Mumbai has nearly 3.5 lakh properties, of which the civic body has data for some 1.8 lakh. According to BMC data, the breakup is 74,062 properties in the city, 1,83,597 in the western suburbs and 86,672 in the eastern suburbs, besides 4,265 government properties.
