The Latest Municipal Policy On Property Taxes
By CA, Vimal Punmiya
1. New System of Property Taxes will be applicable with effect from 01.04.2010. in the present system, the property tax is based on Rateable Value fixed at the time when the building receives its occupation certificate and the same does not changes till the building is redeveloped and/or is given on Rent. But however, the percent of Property Tax goes up and as a result the rate of Property Taxes varies from 58% to 315%.
2. There is different rates chargeable to Non-Agricultural Land, Building under construction and Building ready for occupation (such as Flats, Office, industrial Galas, Godowns, shops, etc.) depending on the market value of property as per Ready Reckoner of Stamp Duty published by the Government of Maharashtra.
3. Once the Property Tax is fixed for a property, the same would be applicable for the next 5 years from the date of application.
4. If the Property tax as per the new system is much higher than the Property tax as per the old system, then the Society or the owner would have the option to write to the Municipal Corporation. The same cannot be more than double in the case of the Residential Property and three times in the case of a commercial property. The increase in the Property Tax after 5 years from the date of application cannot be more than 40% for the next 5 yrs. The same would not be applicable in the case of New Building.
5. The same rate of property tax would be applicable whether the property is self-occupied or given to others on the basis of Tenancy, leave and license, lease, caretaker, Business centre, etc in the present system. The same is approved by the Assembly and will be incorporated in the New System. The Officers of BMC have so much of powers that in the case of a let-out property, the Property tax can vary from 35% to 60%. In Pune, Kolkatta, Delhi, the Property tax is double of the normal property tax if the property is given on Tenancy, leave and license, etc.
6. Concessional rates will be applicable to Charitable Organizations such as School, Hospitals, Temples, etc.). In the case Government Offices for Central as well as State, Foreign Embassies, etc no property tax.
7. the property tax will not be on concessional basis in the case of a new building. However, the old building would enjoy a rebate from 5% to 75% depending on the age of the Building. But the after rebate value cannot be less than the value of the land plus the construction cost.
8. The New system of property tax is transparent and even the property owner can calculate the property tax payable by referring to the Stamp Duty Ready Reckoner. Hence, there would be less corruption.
9. As per the New System, the rates of property tax would be reduced in the Suburbs and increased in South Mumbai depending on the age of the building, floor, type of construction, etc payable on the Market Value of the property calculated as per Stamp Duty Ready Reckoner.
10. If the area of the Residential property is less than 500 sq. ft. (carpet area) then there would be no increase in the Property tax payable. Hence, the New System of property tax would not affect 70% of the Mumbaikars for atleast 5 yrs from the date of application.
11. If the property is lying vacant (i.e. if it is not in use) then the property owner can apply to the BMC and the property tax will be 40% for the normal property tax payable.
12. Further, the Property tax would be payable on the Built-up area of the property.
13. There are chances of error in Data collected by MCGM about the age of building, user type(residential, shop, office, etc.), carpet and built-up area of the premises, etc. in this event, society or property owner can file the complaint /objection with MCGM in prescribed format.
14. The complaint has to be filled with respective Municipal Ward office, with the assessment department. The complaint has to be filed within 21 Days of receipt of the property tax Bill. If you file complaint after 21 days, please file the same with request for condonation of delay.
15. Format for complaint is already sent by MCGM along with the new property tax Bills. Pro-forma is attached herewith.
For more details please contact on Helpline 1278 / 022 23670624 or mail to : firstname.lastname@example.org
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Click Here for sample complaint format
Courtesy : J.B.Patel (Jeby) Mobile:9820538570
MAHARASHTRA CHS RTI UNION
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