BMC budget: Commissioner Kunte announces increase in existing taxes

The Brihanmumbai Municipal Corporation (BMC) may be the country's richest civic body, but it has also been shaken by the central government's decision of abolition of Octroi and implementation of GST (Goods Service Tax) from next year.

Sitaram Kunte, Municipal commissioner

Fearing the loss of Octroi, which forms a major chunk of its revenue, Municipal Commissioner Sitaram Kunte has announced an increase in current taxes and imposing of new taxes in future. On Wednesday Kunte presented the civic budget for the year 2015-2016 to the Standing Committee Chairman, Yashodhar Phanse. The total budget is Rs 33,514 crore with Rs 2.74 crore surplus.

Kunte also announced an increase in existing taxes like property tax, water tax, sewerage tax, and implementation of new taxes like on slums, transport cess, conservancy cess and fire cess. The water tax and property tax will go up by 8 per cent each. Also, sewerage tax will go up from the current 60 per cent to 80 per cent. The civic body will start charging water tax from April but property tax will be hiked from June only.

Defending the planning of implementation of new taxes, Kunte said, "We will have to find a new source of revenue since Octroi is going to be abolished from next year. Recently, we met central government officials and explained the problems the civic body will face then."

Kunte added, "Right now we don't have any solution to earn revenue equal to Octroi. This year it was expected that we would earn about Rs 7,300 crore from Octroi and it will increase every year." The civic body has earned Rs 5,500 crore from Octroi as against the estimated Rs 7,300 crore.