Despite strong opposition from the Congress, NCP and MNS, the ruling Shiv Sena-BJP combine has approved the new capital value-based property tax system.
A proposal to increase water tax was also cleared.
The civic standing committee on Thursday passed the proposal which was pending since 2010, and set out the rules for it. According to civic officials, the rate of taxation needs to be multiplied by the capital value of the property to calculate the total property tax. The new tax system will not increase the property tax in general.
The civic administration, however, states that the new property tax system will not affect most citizens. “As per the new property tax system, the property tax of only 19 percent of the properties will be increased. But around 81 percent will not be much affected by it. Surprisingly, the tax of around 27 percent of the total properties will be decreased,” said Assem Gupta, additional municipal commissioner.
Gupta added that many had misconceptions about the new system, and felt that it would unnecessarily increase the property tax. But, he said, it was created to bring more transparency into it.
Standing committee chairman Rahul Shewale said, “Earlier, the tax collection was only 55 percent. But this new tax system will help to increase the collection up to 85 percent. Even the ward official, as per the old tax system, could increase or decrease the property tax, which will not be the case anymore, as the rules are available for everyone. It will bring more transparency into the system.”
Further, he said, the new system would lead to an increase in the total tax collection from Rs2800crore to Rs3200crore.
The proposal will now be sent to the general body for approval.