Property tax collection delays since Mumbai’s 2023–24 invoices are still pending.

MUMBAI: Property tax collections for 2023–2024 were downsized by BMC from Rs 6,000 crore to Rs 4,500 crore. Its total collection up to January 3 was just Rs 606 crore. Property tax bills for apartments up to 500 square feet must still be issued by BMC.

During his budget speech on Friday, BMC commissioner Iqbal Chahal stated that the company had not been successful in its Supreme Court review case. Accordingly, there is a decline in property tax revenue collected, which lowers BMC’s revenue from property taxes, according to Chahal.

The problem stems from the 2010–2012 property tax assessment. Property Owners’ Association and others filed a petition with the Bombay High Court in 2013, contesting the constitutionality of the Mumbai Municipal Corporation Act, 1888, revision that allowed for the imposition of property taxes.

In its order, the HC mandated that assessments based on the capital value system (CVS) be conducted prospectively, starting in 2012 when the regulations went into force, rather than retroactively. It annulled the 2010 CVS bills and the special assessment order. BMC was instructed to reassess property’s capital worth for tax assessment purposes and according to the Act’s procedures.

According to a former municipal commissioner, the problem stems from the assessment of older structures, and BMC ought to have updated these homes’ property tax bills by now. The previous commissioner questioned why invoices for newly constructed structures were taking so long to be issued when there was no problem.

The opposition leader in the municipal assembly and former Congress corporator Ravi Raja stated that development charges and property taxes are BMC’s primary sources of income. The estimated reduction from Rs 6,000 crore to Rs 4,500 crore simply shows inadequate management. He stated that property tax invoices were supposed to be sent out by January 1st, but they haven’t yet.

Asif Zakaria, a former Congress corporator who had brought up the subject of improper property tax assessment implementation as a member of the standing committee, stated that between 2010 and 2015, BMC charged 40% more than what the Act permitted and an additional 20% more during the next five years (2016–2020).