Mumbai: BMC brings slum tax back on the table

If the proposal is cleared, slum settlements will have to make a lumpsum payment every year

The BMC has brought back from the dead its year-old plan to tax slums. In its budget, presented on Wednesday, the civic body proposed levying a lumpsum property tax of Rs 2,400-Rs 18,000 on each slum structure, depending on its size and type.

It had tabled the same proposal last year before the law committee. But corporators, fearing backlash during election season, forced the BMC to bury the plan.

As per the plan, the slum tax will help the civic body earn an annual revenue of Rs 250 crore. Taxes will be collected retrospectively from 2010, if the proposal is given the green light.

A senior official from the assessment and collection department, BMC, explains that under the Jawaharlal Nehru National Urban Renewal Mission, it is mandatory to levy property tax on every structure in the city.

"The proposal aims at levying a lumpsum charge and not a capital valued-based amount to avoid heavy tax burden."

However, payment of the tax will not translate into regularisation of slums.

As per Census 2011, more than 55% of Mumbai's population lives in slums, largely concentrated at Dharavi, Malad, Dahisar, Kurla, Bhandup and Govandi.

The sum tax is expected to be an able alternative in revenue generation to the octroi, which will be phased out in July once the goods and services tax is implemented.

BMC Commissioner Ajoy Mehta had said in budget speech that the slum tax will also help the civic body collect data on the exact number of slum structures and enable better delivery of public services.

The Congress has opposed the proposal. Sanjay Nirupam, the party's city president, said, "The Shiv Sena had promised in the run-up to the BMC election that it would waive property tax. Our party will oppose the move in BMC."

Till 2007, the BMC used to collect a service charge of Rs 100 from residential structures and Rs 250 from non-residential units.