In light of the recent rise in Ready Reckoner rates, the BMC’s Assessor and Collection (A&C) department has proposed a property tax hike of 10 to 12%. The proposal has been submitted for approval to Municipal Commissioner Bhushan Gagrani. Notably, while the civic body is required to revise property tax rates every five years, the last revision occurred in 2015-16.
After the abolition of Octroi, property tax has emerged as the second-highest revenue source for the BMC. However, in recent years, the BMC has faced a decline in revenue collection. A significant factor contributing to this shortfall has been the exemption of property tax for residential properties up to 500 sq ft, leading to a loss of approximately Rs 462 crore. Additionally, the revision of property tax, which was due in the 2020-21 financial year, was deferred due to the pandemic. Since then, proposals to increase property tax have been consistently rejected. As a result, there has been no hike in property tax in Mumbai for nearly a decade.
On Monday, the state government raised the ready reckoner rate by 4.39% across the state for the financial year 2025-26. The new rates will be applicable from April 1. “We have calculated the property tax based on the revised Ready Reckoner rates. The proposed increase in property tax will range from 10 to 12%. Once we receive approval from the Municipal Commissioner, the proposal will also require permission from the state government,” said a senior civic official.
Every year, the BMC collects property tax from over 9 lakh properties within its jurisdiction. For the 2023-24 fiscal year, the BMC issued provisional property tax bills, which included a 15-20% hike in accordance with the five-year revision rule. However, the proposed increase was withdrawn following strong opposition from former corporators and citizens. This same proposal had also been postponed the previous year.
