BMC budget 2021-22 may not have any new taxes

However, five-yearly revision of property tax is due; capital expenditure may be increased; spending on admin may see dip

MUMBAI: The Brihanmumbai Municipal Corporation’s (BMC) budget for 2021-22, which will be presented before the standing committee in the first week of February by municipal commissioner IS Chahal, is unlikely to introduce new taxes for Mumbaiites. However, the civic body revises property tax every five years, and a revision is due in 2021 through a special sitting of the standing committee of the civic body, according to the civic official. The hike will not be announced in the budget document 2021, but a few months later. The outlay is likely to be higher than the previous year, according to a senior civic official.

At a time when the BMC, the country’s richest civic body, is facing a cash crunch, the budget will prioritise expenditure on key departments such as health, education, and infrastructure-related developments such as roads and coastal road. Funds will be allotted for at least one new infrastructure project that has been on the cards in 2020.

A senior civic official said, “Every year, usually there is an 8% to 10% increase in the budget. Our budget will be larger this year as well, and the capital expenditure will also be more. Moreover, important departments such as health, education, and infrastructure projects will not see a cut in the budgetary allocation, or a reduction in the budget outlay in comparison to last year.”

The coastal road project is likely to receive substantial amount of funds. Moreover, the BMC’S plan to come up with a desalination plant at Manori in Mumbai that was approved by chief minister Uddhav Thackeray in November will also receive a budgetary allocation. “We are not increasing any new taxes this year in the budget. However, during the year, a revision in the property tax is due,” the officer added.

The BMC budget 2020-21 was pegged at ₹33,441.02 crore, which was 8.95% more than the previous year’s budget. The budget for 2019-20 was pegged at ₹30,692.59 crore.

The senior civic official quoted above said, “The civic body plans to increase its capital expenditure. On the revenue expenditure side, pensions and salaries will not be touched, but the BMC is looking to bring down administration related revenue expenditure.”

Another senior civic official from the property tax department said, “There are several components of the property tax. For homes below 500sqft, only general tax has been waived. In 2021, when we look at revision of the property tax, we are not going to increase general tax or factor component. So the increase will be minimal. But the civic body’s kitty is likely to see an increase in revenue by up to 17%.”

Anandini Thakoor, trustee, H-west Citizens’ Federation, said, “Among the top priorities should be better civic amenities for citizens, primarily water supply and better roads. There are many more, but these two areas need work on priority. The BMC should beef up their conservancy staff.”

The BJP on Thursday alleged that the municipal corporation is heading toward bankruptcy, and has manipulated figures of income. The BJP claimed the BMC has received only 25% of the estimated income in 2020-21. The BJP said while the property tax department earned only ₹734.34 crore instead of the estimated income of ₹6768.58 crore, and the development plan department earned only ₹708.28 crore instead of the estimated ₹3879.51 crore. Yet expenditure on Covid-19 relief work has been ₹2,100 crore so far. While the BMC showed a surplus of ₹6.52 crore in February, this increased to ₹2,579.33 crore in August, which the BJP claimed is manipulation of numbers, alleging the following budget 2021 will also show manipulated figures. A senior civic official said, “All accurate details have been submitted to the standing committee. Moreover our expenditure, for example the Covid-related expenditure, amounts to ₹1,533 crore.”