From: <info@karmayog.org>
Date: Fri, Nov 12, 2010 at 12:34 PM
Subject: BMC Draft Property Tax Rules for Mumbai - do comment
To: palashbiswaskl@gmail.com
Property taxes will be charged henceforth based on these Rules.
MCGM is currently accepting suggestions and comments on the Draft Rules.
The last date for sending in your suggestions is 15 December 2010.
Comment 1:
These Rules are for fixing the Capital Value of Buildings and open Lands. However, the tax that will be levied by BMC on this is not covered in these Rules.
(e.g. if the Capital Value of your land is Rs. 1 crore, the tax that will be levied is not part of these Rules).
This is similar to the Government telling citizens what are the different items that would constitute their Wealth without telling them what will be the Wealth Tax levied on this.
Therefore, for citizens to understand the impact and thus comment on the Draft Rules, it is important to know what will be the percentage of tax applied on the Capital Value.
Comment 2: NTB - Nature and Type of Building
What is important is the relative Capital Value of different types of Lands and Buildings, i.e relative to your house, how are other types of properties being taxed, as the government at all times tries to maximise its revenue through taxes,
Hence, in the current list of uses of open land (Schedule A), a residence has been assigned a Capital Value of 1, which is the same as the Capital Value assigned for commercial establishments such as a Shop, Office, Hotel, Cinema Theatre, Club House, Film studio, etc.
This appears to be unfair as in other areas of BMC taxes such as on water, electricity, etc. there are clearly differentiated rates for residential and commercial establishments, with residential units always being assigned the lowest applicable rate.
Comment 3: FF - Floor Factor
Capital Value of your flat will depend on which floor you live.
The Draft Rules assign a Capital Value of 1 to the ground floor, and a Capital Value of 10% more for the 11th - 20th Floors, etc.
The High Court has ruled that in the case of cooperative housing societies, residents on higher floors cannot be charged more for common facilities such as lift maintenance, etc. So it would be appropriate that there is a uniform Capital Value for all residents in a building, irrespective of the floor that they stay on.
Individual buildings / societies may be assigned differential Capital Values based on the number of floors in that building.
Comment 4: AF - Age Factor
As buildings grow older, the Capital Value assigned reduces by approximately 0.6% per year upto a maximum of 30% in 50 years.
This means that even buildings of 50 years or more still have to pay at a 70% of tax level, as compared to a building that is only 5 years old.
Often in older buildings, the paying capacity of a resident decreases. Hence Capital Value should decrease at a rate of 2% per year.
Comment 5:
Capital Value of open land depends on the permissible FSI of that land.
It should be clearly stated that this would be the lowest applicable FSI.
MCGM's Draft Rules for Fixing Capital Value of Lands and Buildings is at www.mcgm.gov.in or via http://www.karmayog.org/redirect/strred.asp?docId=31242
Do email us a copy of your response at info@karmayog.org
It is important for citizens to respond and help frame better rules and regulations. It is far easier to modify a draft set of rules than amend rules that have already been passed. Several of the existing Development Control Regulations that have created chaos in Mumbai could have been prevented if enough number of objections and suggestions had been received by MCGM, at the time of framing of the respective clauses.
--
Palash Biswas
Pl Read:
http://nandigramunited-banga.blogspot.com/
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