With just Rs 904 cr collected until October, civic body likely to miss Rs 7K cr goal; blames non-implementation of new tax regime
The new budget had granted relief to residential property of 500 sqft or less carpet area
The BMC is going to miss its property tax target once again, as its new tax regime hasn’t been passed this year as well. The corporation had set a target of collecting Rs 7,000 crore for this financial year (2022-23) in accordance with the implementation of a new tax regime, which was supposed to increase the tax by 14 to 16 per cent. But the hike wasn’t implemented and till October 27, the BMC was only able to collect Rs 904 crore, which is slightly less than the collection of last year on the same date. Last year, till October 27, the civic body had collected Rs 1,053 crore. “At the end of the financial year—March 2022—the BMC collected Rs 5,792 crore. Even this year, the tax regime hasn’t been approved, but we will try to reach as close as possible to the target,” said an official with the BMC.
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For the last few years, despite property tax being the largest income source, besides compensation of Octroi, the BMC has been missing its set target by at least 20 to 30 per cent. Municipal commissioner Iqbal Singh Chahal in his budget speech of 2022-23 had spelled out the reasons for the shortfall: capital value revision being deferred considering the Covid-19 situation and tax payers paying 50 per cent of the arrears tax as per court order, as the final decision against the new capital value-based Tax System is still pending in the writ petition. The new budget had also granted relief to residential property of 500 sqft or less carpet area. As per estimates, 16,14,000 citizens got 100 per cent relief from Property Tax payment. The amount of exemption to the citizens is to the extent of Rs 462 crore per annum.
As per the BMC Act, property tax is revised every five years. The last revision took place in 2015 and it was supposed to be revised in 2020. The civic administration had proposed a 14 per cent hike in the tax. But the hike was postponed due to the pandemic; the corporation elections have delayed it further.
Collection of property tax in cr
2017-18 Rs 5,201
2018-19 Rs 4,492
2019-20 Rs 3,735
2020-21 Rs 4,582
2021-22 Rs 5,792
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