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BMC’s property tax collection inches closer to 2020-21 target

In 2020-21, the civic body had estimated to collect Rs 6,768 crore in property tax, but the same was revised to Rs 4,500 crore.

Written by Sanjana Bhalerao | Mumbai |
Updated: February 26, 2021 8:58:24 pm
Brihanmumbai Municipal Corporation, property tax collection, property tax bills, financial year, financial year 20-21, mumbai news, indian expressIn addition to attaching 11,661 properties, BMC will also begin auctioning properties. (File Photo)

With the current financial year ending in a little over a month, the Brihanmumbai Municipal Corporation’s (BMC) property tax collection – the civic body’s primary source of revenue – is inching closer to its annual target. The BMC has collected Rs 2, 002 crore in property tax as of February 25, making for an increase of Rs 1,264 crore since December last year.

In 2020-21, the civic body had estimated to collect Rs 6,768 crore in property tax, but the same was revised to Rs 4,500 crore. However, until December 2020, the civic body’s revenue receipts from property tax were at a measly Rs 738 crore.

The assessment and collection department of the BMC issues property tax bills for a particular financial year every May. The deadline for paying 50 per cent of the tax is in August, with the remaining 50 per cent is to be paid in December. However, due to the pandemic, property tax bills for 2020-21 were issued in December last year.

Residents have three months’ time from the time of receiving the bills to paying the tax and a penalty of two per cent is levied in case the bills are not paid. Following the non-payment of bills after 90 days, BMC sends repeated reminders and notices to the defaulters. For the current financial year, the BMC is sending reminders to defaulters through SMS and voice messages.

As per its 2016 policy, the BMC also seals lifts, entrances and water connections of buildings to restrict their usage and recover the property tax. Before this policy, the civic body only levied penalty charges on defaulters. If the defaulters still don’t settle their dues, the civic body attaches and auctions the property. Residents may pay their dues and free the property until the civic body auctions it.

In the current financial year, disconnection of the properties’ water supply, their attachments and auctions were delayed owing to the Covid-19 pandemic. The BMC has attached 3,424 properties including open land, commercial and residential properties so far this year.

In his Budget speech for 2021-22, Municipal Commissioner Iqbal Singh Chahal had said that he was confident that the civic body would be able to meet its revenue targets by the end of the year. He further said that the BMC’s revenues had declined due to decisions taken to combat Covid-19 and providing relief measures to different sectors affected by the pandemic. “The slowdown in real estate led to a reduction in the assessment of new properties, thereby decreasing the revenue collection,” Chahal had said.

Since 2013, the civic body has been unable to match its target of income that it hopes to collect from all its sources, including property tax. On an average, the BMC has managed to attain 60 per cent of its targeted income every fiscal year. For financial year 2018-’19, while the property tax target was Rs 5,206 crore, the BMC managed to collect Rs 5,082 crore. In 2019-20, the BMC’s target was Rs 5,600 crore, but only Rs 4,100 crore was collected.

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