For 5th consecutive year, No property tax on residential flats up to 500 sqft in Maharashtra

For 5th consecutive year, No property tax on residential flats up to 500 sqft in Maharashtra

For 5th consecutive year, No property tax on residential flats up to 500 sqft in Maharashtra

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In a move that marks the fifth consecutive year, the Maharashtra government has announced a waiver on property tax for residential units sized up to 500 square feet. The state cabinet approved a proposal for this tax waiver, which will be facilitated through the issuance of an ordinance.

Given the upcoming elections, political observers anticipate additional incentives being offered to the electorate, continuing a trend that started in 2019-20 in response to the Covid-19 pandemic.

Both the Maha Vikas Aghadi (MVA) and the current Mahayuti government have consistently implemented property tax waivers, impacting the revenue of civic bodies. The BMC, in particular, experiences an annual loss of approximately Rs 300 crore due to this decision, affecting the 16 lakh residential units under 500 sq ft.

Comprising water tax, water benefit tax, sewerage tax, sewerage benefit tax, general tax, education cess, tree cess, street tax, and betterment charges, the property tax waiver is expected to alleviate an additional tax burden of Rs 736 crore for Mumbaikars, according to a press release by the state government. 

The BMC administration, having already adjusted its revenue collection estimates from property tax, emphasizes that the waiver is essential following a Supreme Court judgment on the capital value system, which prompted the need for amendments to existing laws without revising capital values.

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