The BMC will present its budget today, with a gap of Rs 1,454 crores in property tax receipts

Even as it reveals its budget spending today, the cash-strapped Brihanmumbai Municipal Corporation (BMC) is scrambling to reach its income collection target from property tax. The Free Press Journal has learned that the local body is facing a shortfall of Rs 1,454 crores in property tax revenues with less than two months left in the current year.

 

So far, it has collected 73% of the revenue scheduled for this fiscal, against a target of Rs 5,400 crore. The civic tax collection and assessment department has collected a total of Rs 3,946.36 crores so far, according to data collected until the evening of February 2, 2022.

 

"Last year, the Covid-19 pandemic slowed the assessment and inspection of properties, as well as the collecting of property tax dues, with lockdown limitations playing a major role. Tax collection did not begin until December 2020 and January 2021. We have been actively collecting dues and inspecting properties this year, so we must complete 73% of the entire intended collection, as compared to the previous year," stated a senior official from the department.

 

Since the city of Mumbai's primary source of revenue, octroi, was abolished in July 2017, property tax collection has become the city's most important source of revenue. The civic body set a target of Rs 6,788.58 crores for property tax collection for the fiscal year in the 2020-21 budget.

 

However, because of the city's Covid dilemma, the aim was postponed. As a result of the impending financial crisis, the local body was forced to delve into its reserve reserves, and it planned to sell municipal bonds to fund numerous infrastructure projects. Between April 1, 2020, and March 31, 2021, the civic body collected Rs 5,135 crores, compared to a target of Rs 5,200 crores for the current fiscal year.

 

The civic body will have to collect Rs 1,454 crores in less than two months this year to meet its target for the current fiscal year.

"It will be a problem to close the income gap in less than two months," a top official from the Tax Assessment and Collection Department stated. In the last few months, it is not possible to create more than 20% of the predicted revenue objective, according to experience. Our employees, on the other hand, are working feverishly to recover as much debt as possible."

 

 

According to BMC sources, the impact of the collection shortage will be apparent in the city budget 2022-23, which will be presented today at 11 a.m. The BMC is expected to raise funding for health infrastructure in its future budget, with the budget estimate for 2022-23 expected to rise by 7% to 8% above last year's Rs 39,038 crores. The budget for healthcare will also be increased. The health department has requested more funding for infrastructure and primary healthcare services, according to Suresh Kakani, Additional Municipal Commissioner (Health). "As a result, this year's health budget outlay will be significantly higher," he stated.