A recent report on outstanding property dues accessed by TOI has revealed that Mumbai's civic body, BMC, is grappling with a significant shortfall in property tax revenue owed by several government agencies. Despite efforts to meet its targets, BMC faces a staggering amount of over Rs 3,000 crore in unpaid property taxes.
Leading the list of delinquent agencies is the Mumbai Metropolitan Region Development Authority (MMRDA), with outstanding dues amounting to Rs 2,042 crore as of April 3. Following closely behind are Maharashtra Housing and Area Development Authority (Mhada) with Rs 246 crore, the central government with Rs 294 crore, and the Mumbai Port Authority with Rs 31 crore in unpaid taxes. Other entities on the list include the Railways, the state government, and the police commissioner.
BMC officials cited challenges in meeting their property tax targets for the fiscal year, with bills issued as late as February 2024. This delay has contributed to the discrepancy between actual collections and the target, with the civic body managing to collect only Rs 3,545 crore against a set target of Rs 4,500 crore. Furthermore, the payment deadline for the financial year 2024-25 has been extended to May 25 due to the delayed billing process.
Despite the substantial arrears, BMC has refrained from resorting to stringent measures such as property attachment, given the governmental status of the defaulting agencies. Officials noted that outstanding dues date back as early as March 2010.
Responding to inquiries, MMRDA authorities clarified their stance, citing provisions from the Mumbai Metropolitan Region Development Authority Act, 1974. They argued that property tax should be levied at a reduced rate of 50% on properties owned by the authority, citing the nature of projects falling under the Indian Railways Act, 1989. However, BMC's property tax department countered, stating that no such provision exists in the Mumbai Municipal Corporation Act of 1888, which governs property tax levies.
Property tax constitutes one of the largest revenue streams for BMC. Out of over nine lakh properties in Mumbai, around 3.6 lakh are exempted from property tax due to their smaller size. Despite setting ambitious targets, BMC had to revise its revenue goal from Rs 6,000 crore to Rs 4,500 crore for the fiscal year 2023-24, underscoring the challenges faced in tax collection efforts.
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