500 sqft homes were to get tax reprieve
Fat chance of getting the Shiv Sena to deliver on its poll promise of a property tax rebate. The party had, in its BMC election manifesto, promised to do away with property tax completely for houses measuring 500 sqft and a rebate on those measuring 700 sqft, but this is unlikely to pass the civic body's muster.
Civic officials said the BMC will lose its biggest source of income -- octroi — after the goods and services tax rolls out in June. The abolition of octroi will lead to a direct loss of nearly Rs 7000 crore every year. Octroi collection comprises 33% of the BMC's total revenue share. Considering a possible financial instability in future, the civic body is unlikely to risk taking on the burden by announcing tax rebates.
An official from the Assessor and Collection department said, "From property tax the BMC earns more than Rs 4,000 crore every year. Announcing no tax on properties of up to 500 sqft and rebate on those up to 700 sqft would add a huge burden on the BMC and could affect big-ticket projects."
The civic budget for 2017-18 will be presented before the month end. Last year, Municipal Commissioner Ajoy Mehta had presented a budget of R37,000 crore. According to sources, this time it could reach R40,000 crore. Civic officials from the finance department said rather than announcing new projects, the civic body will make more provisions for speeding up ongoing big projects.