BMC Budget 2025: Mumbai Civic Body Presents Budget Of ₹74,427 Cr For 2025-26 | Vijay Gohil FPJ
Mumbai: The BMC’s big-tickets and prestigious projects have contributed to its committed liabilities, which now stand at a staggering Rs 1.93 lakh crores. Additionally, substantial spending on critical civic infrastructure including roads, stormwater drains, bridges, healthcare, and solid waste management has pushed the total expenditure to Rs 2.32 lakh crores.
In light of growing concerns over its escalating financial pressures and mounting liabilities, the BMC has made revenue augmentation and strategic expenditure rationalisation top priorities in its budget estimates for the financial year 2025-2026, unveiled on Tuesday.
Fixed Deposits (FDs)
The BMC holds total FDs of Rs 81,774.42 crores, with Rs 39,543.64 crores reserved for infrastructure development and Rs 42,230.78 crores allocated for committed liabilities such as employee pensions, provident and gratuity funds, and contractor deposits. For the financial year 2025-26, the BMC has decided to raise Rs 16,699.78 crores through an internal temporary transfer from FDs, while an estimated Rs 12,119.47 crores will be withdrawn in the 2024-25 financial year.
To maintain financial stability without hindering the city’s development, the BMC has initiated a restructuring of its financial resources and is exploring new revenue-generation avenues through eight different strategies.
Increase share in Additional FSI: To strengthen its financial position, the civic body has introduced measures such as an additional Floor Space Index (FSI) premium and Vacant Land Tenancy (VLT) policy. The BMC has also requested the State Government to issue a directive ensuring that 50% of the premium from additional FSI is allocated to the civic body, an increase from the previous 25%. As a result, the BMC has already received Rs 70 crore in additional revenue. A total revenue of Rs 300 crore is expected to be generated from this in the financial year 2025-26.
VLT policy: The BMC’s Estate Department has finalised a policy to develop various lands under the VLT framework for public purposes, with provisions to convert them into leasehold properties wherever feasible. Through this initiative, the civic body expects to generate Rs 2,000 crores in revenue over the next four years from a one-time premium and annual ground rent.
Additionally, the fire and emergency service fee has contributed Rs 480 crores in revenue as of December 31, 2024, with projections reaching Rs 686 crores by the end of the financial year. For 2025-26, the estimated revenue from this source is around Rs 759 crores.
To further boost its financial resources, the BMC has also invited tenders for leasing plots at the Worli asphalt plant, aiming to facilitate development through private developers. Also, BMC has proposed to increase fees for renewal of trade licenses.
Property tax: The BMC will not increase property tax in the new financial year but is exploring revenue-boosting measures, including taxing commercial units in slum areas. Currently, most taxpayers are paying only 50% of the tax as per an interim court order, with total outstanding dues reaching Rs 22,565.38 crores as of March 2024.
An amendment to the rules, based on the Supreme Court’s final decision, is in progress. Meanwhile, the revised property tax revenue for 2024-25 stands at Rs 6,200 crores, up from the initial estimate of Rs 4,950 crores. For 2025-26, the proposed estimate is Rs 5,200 crores. By December 2024, Rs 5,229.20 crores had been collected, including Rs 1,491.36 crores from 2023-24.
Water and Sewage charges: For the financial year 2024-25, the initial estimate for revenue from Water and Sewerage Charges was Rs 1,923.19 crore, which has been revised to Rs 2,131.98 crore, showing an increase of 10.86%. By December 31, 2024, actual revenue collected was Rs 1,141.56 crore. The projected revenue for Water and Sewerage Charges in the 2025-26 financial year is Rs 2,363.15 crore.
