BMC budget: Commissioner Kunte announces increase in existing taxes

Feb 05, 2015, 10:40 IST | Laxman Singh

Announcing the total budget, Rs 33,514 crore for 2015-2016, and anticipating the loss of revenue, the municipal commissioner announces an increase in existing taxes and implementation of new taxes

The Brihanmumbai Municipal Corporation (BMC) may be the country’s richest civic body, but it has also been shaken by the central government’s decision of abolition of Octroi and implementation of GST (Goods Service Tax) from next year.

Sitaram Kunte, Municipal commissioner
Sitaram Kunte, Municipal commissioner

Fearing the loss of Octroi, which forms a major chunk of its revenue, Municipal Commissioner Sitaram Kunte has announced an increase in current taxes and imposing of new taxes in future. On Wednesday Kunte presented the civic budget for the year 2015-2016 to the Standing Committee Chairman, Yashodhar Phanse. The total budget is Rs 33,514 crore with Rs 2.74 crore surplus.

Kunte also announced an increase in existing taxes like property tax, water tax, sewerage tax, and implementation of new taxes like on slums, transport cess, conservancy cess and fire cess. The water tax and property tax will go up by 8 per cent each. Also, sewerage tax will go up from the current 60 per cent to 80 per cent. The civic body will start charging water tax from April but property tax will be hiked from June only.

Defending the planning of implementation of new taxes, Kunte said, “We will have to find a new source of revenue since Octroi is going to be abolished from next year. Recently, we met central government officials and explained the problems the civic body will face then.”

Kunte added, “Right now we don’t have any solution to earn revenue equal to Octroi. This year it was expected that we would earn about Rs 7,300 crore from Octroi and it will increase every year.” The civic body has earned Rs 5,500 crore from Octroi as against the estimated Rs 7,300 crore.

BMC has a budget of Rs 33,514 crore for the year 2015-16

Highlights of the budget

Coastal road
The BMC plans to construct a 35.6 km coastal freeway from Nariman Point to Malad-Marve road comprising a combination of roads on reclamation, bridges, elevated roads and tunnels in the Western suburbs. A token provision of Rs 200 crore has been made for year 2015-16.

Civic body has decided to construct one of its most ambitious projects of connecting East to West, the elevated GMLR (Goregaon-Mulund Link Road). A provision of R300 crore has been made for it.

Hydropower project at Middle Vaitarna
The state government has shown interest to give the nod to a hydropower project on Middle Vaitarna. BMC has allocated R31 crore for the project. mid-day had reported on this (BMC may soon produce power from Middle Vaitarna dam, January 24, 2015)

Water Department
The civic body vouched for its ability to supply 24x7 water supply in the coming years with a huge budget of R6,127.14 crore kept aside for the water department alone. The repairs and reconstruction of 80-year-old pipelines has been the priority of the civic body. There are budgetary provisions of R1,035 crore for tunnels in the water supply system as well.

Garden Department

The Garden department has a provision of about R529.81 crore and a huge number of theme parks are also proposed in the budget.

Fire brigade upgrade
For the improvement of the fire brigade department overall, a provision of R486 crore has been made. In order to reduce the response time in any emergency, the Mumbai Fire Brigade had proposed an integrated control room for deployment of 10 Mini Fire stations at strategic locations. However there has been little progress on the project. A R8 crore provision for this was made for the year 2014-15.

Current water taxes
Slums - Rs 3.4
Non slums, Buildings Societies - Rs 4.32
Hospitals and Coaching classes - Rs 32.40
Offices, shops and industrial Units - Rs 43.20
3 Star hotels - Rs 64.80
* Current water taxes are charged on per 1,000 litre

Allocations in new budget
Health - Rs 3,359.78 crore
Primary Education - Rs 2,500.89 crore
Road and Traffic - Rs 3,875.17 crore
Storm Water Drains - Rs 1,426.33 crore
Solid Waste Management - Rs 2,231.95 crore
Fire Brigade - Rs 486.29 crore
Garden, Zoo, Theatre - Rs 698.09 crore
Bridges - Rs 670.79 crore

Budgets of other states in India (in crore)

Rs 14,900.07

Rs 9,697.04

Rs 14,817.17

Rs 8,979.26

Arunachal Pradesh
Rs 12,795.18

Rs 1,343.62

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