BMC discusses feasibility of rebate on property tax

After the Mira-Bhayander Municipal Corporation (MBMC) last week passed a resolution offering a 50% rebate on house tax and an interest waiver on outstanding in view of Covid-19, Mumbai civic body too is considering to give a similar concession to Mumbaikars sources in the department revealed. Once decided, a proposal will be tabled before the standing committee for approval.

The BMC commissioner Iqbal Singh Chahal confirmed that they are considering the matter pertaining to property tax rebate to Mumbaikars.

Currently, property tax is the only and major source of revenue after the civic body abolished the octroi. Other than the slowdown in real estate, leading to a decrease in the assessment of new properties, the issue of imposing the capital value tax which is sub-judiced has hit the revenue collection too.

With octroi, which was for decades the BMC’s cash cow, now replaced with the universal Goods and Services Tax (GST), the corporation is entitled to receive a compensation of Rs 9073.28 crore from the state government every year for the next five years. The state government this year (Upto February, 2020), has paid only Rs 6040.80 crore.

However, this decision will put a huge dent in the municipal coffers. In the first quarter of the current financial year, only Rs 966.30 crore was collected against the target of Rs 4,949.55 crore. It is also likely to reduce the total revenue assumed for property tax collection for the current fiscal.