In a bid to provide relief to property owners amid the second wave of coronavirus outbreak, Maharashtra government on Friday said there will be no change in property tax now. “There will be no hike in Property tax in Mumbai till the Covid-19 situation continues,” said Kishori Pednekar, mayor of Mumbai, according to news agency ANI. “We don’t know how long will it take but till then we will not burden Mumbaikars by increasing the property tax,” she further added, ANI mentioned.
The Birhanmumbai Municipal Corporation (BMC) earlier proposed to increase the property tax by at least 14 per cent based on ready reckoner rates as on April 1, 2021. At present, property tax rates are calculated based on the ready reckoner rates of 2015 in the financial capital. The corportaion wanted to revise the rates following the current ready reckoner rate. Usually BMC updates property rates in five years. The BMC has collected Rs 2,002 crore in property tax as of February 25.
“The decision to withhold any increase in property tax is a welcome relief for many who have been severely impacted by the pandemic and the subsequent lockdowns. However, a complete waiver for a limited period — maybe for a year or even few months — would have been more favourable, especially for those sectors where business has been negatively impacted by the lockdown,” said Anuj Puri, chairman — ANAROCK Property Consultants.
“In neighbouring Gujarat, the state government has waived off property taxes for a year for some sectors including hotels, resorts, restaurants, cinema halls, gyms etc such a concession would have definitely aided the ailing sectors,” he added.
Property tax is the amount that property owner has to pay to municipal corporation or local government every year. Property can include own house, office building and the property that he has rented to others. The tax is usually calculated on value of the property based on the ready reckoner rates. The ready reckoner rate depend on various factors such as nature of construction, number of floors, carpet area of the property and area in which it is located.
“The move to not increase the property tax in Mumbai during such a difficult time bodes well for all stakeholders specially home owners. The second wave of the pandemic has not only disrupted construction activities but it has also hampered housing demand and this decision will help to neutralise, if not improve the sentiments of homebuyers,” said Deepak goradia, President, CREDAI MCHI.
“Mumbai has once again taken a step that will provide relief to the property owners, just like the stamp duty reduction it announced last year. We would also request the Maharashtra Government to reduce stamp duty as it will help the real estate sector come out of the tough situation, which it is facing after the second wave. Property registration are down by 45 percent in Mumbai for May compared to April; the rebate, if announced, will lead to an increase in the sale that went dropped after last year’s discount was withdrawn,” said Mani Rangarajan, group chief operating officer, Housing.com, Makaan.com & PropTiger.com.
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