In a cash crunch after the global financial meltdown and employees’ salary hike, the city municipal corporation has sought to bolster its revenues by demanding a share of the stamp duty and registration charges on property deeds. It also wants a share of the professional tax deducted from an employee’s salary.
The Brihanmumbai Municipal Corporation (BMC) has decided to ask for a 50% share in charges collected by way of stamp duty, registration fee and professional tax. Currently, the entire sum collected is retained by the state.
Stamp duty and registration charges are payable during the transfer of any immovable property. The civic administration has justified the demand by claiming that the infrastructure — on the basis of which the new development facilitating such transfers was taking place — was being provided by them. A senior civic official also argued that it was this infrastructure that was creating opportunities in the job market.
The state earns close to Rs9,000 crore through stamp duty and registration charges. Approximately, one third of this, Rs3,000 crore, is the estimated collection from Mumbai. A 50% share will boost civic revenue by Rs1,500 crore. The BMC hopes to pocket another Rs500 crore by way of professional tax.
An official request is expected to be made by the city mayor’s office, which presides over the municipal corporation, in the near future.
While the recessionary trend has led to a significant dip in the BMC’s income, the increase in employee salaries after the sixth pay panel recommendation has caused establishment costs to rise by Rs1,800 crore. Having proposed measures to cut establishment costs, the civic body is now looking a new source of revenue.
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