New property tax rate for Mumbai passed by BMC
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The new property tax calculating formula has been passed by the BMC.This calculation will now be based on the value of the property rather than the rent which it can earn in a year (which was the earlier formula).The result of this change will mean no change for flats less than 500 sq ft but for newer properties it can mean double the property tax than before.
These proposals were passed by the BMC standing commitee on Thursday,10 May,2012.
According to the new formula,the property tax rate will be multiplied by the Capital value of the property to arrive at the property tax.
According to the BMC,the new method will cause an increase in 19% percent of properties.Rest will remain unaffected according to them.Earlier even the ward officer could increase or decrease the property tax if he saw it necessary,but this will not be possible anymore.
According to them,the new tax will fetch 32,000 crores against 3200 crore at present.
The new rates of property tax will be the following :-
Residences (with metered water connection):0.41% of capital value
Offices:1.95% of capital value.
Banks:3.91% of capital value.
Illegal buildings (without OC or water connection):8.44% of capital value.
The capital value of a property will be determined by four factors : price, area, age, and the type of property.
The proposal is yet to be passed by the General body of BMC.However,the first hurdle has been cleared.
Sourced from newspapers like DNA,Times of India and online resources.
For more information contact:
- Property Tax:Builders to be held accountable?(navimumbairealestate.org)