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In dire need of funds, PMC proposes 12% hike in property tax, 15% in water charges

Pune, pune realty, pune property

The PMC has proposed a hike in the charges on the property, water, water, and sewage

After scrapping the 40 percent concession in property tax, the Pune Municipal Corporation (PMC) on Tuesday proposed a hike of 12 percent in the tax and a 15 percent hike in water charges for the 2020-21 financial year.
The PMC is facing a deficit of nearly Rs 2,000 crore in its Rs 6,000-crore budget for 2019-20.

The civic body has also proposed a hike of 5.5 percent in the general tax category, 1.5 percent in water cess and 5 percent in sewage charges. “The hike in tax rates is estimated to increase revenue collection by Rs 150 crore for the year. The hike in taxes will also be applicable for mobile towers and properties used by IT companies,” said PMC Commissioner Saurabh Rao.

The PMC needs funds to carry out emergency works as well as civic works in the jurisdictions of its many ward offices. The civic administration had earlier proposed the 12 percent hike in property tax for the financial year 2019-20, but the proposal was turned down by the civic standing committee, which directed it to increase revenue by plugging leakages in the recovery of various taxes.

If this proposal is approved by the standing committee, the annual rateable value (ARV) for general property tax will increase and be in the range of 22.25-46.25 percent, as against the existing 16.75-40.75 percent. The water tax will increase to 7.25 percent from 5.75 percent and sewage tax will increase to 14.5 percent from 9.5 percent.

The civic administration said the 15 percent hike in water charges has been proposed in accordance with the civic body’s decision in 2016-17 to increase it by 15 percent every year till 2020-21, to raise enough funds for its 24x7 water supply project in the city. “This increase in water charges will increase the revenue by nearly Rs 40 crore. It will be the last hike in water charges as per the decision was taken in 2020-21,” said Rao.

In its proposal, the PMC has kept the entertainment tax unchanged. The fire cess of 1.5 percent, tree cess of one percent, cleanliness tax of 20.50 percent, road tax of 10 percent, and education cess of 1.75 percent also remain unchanged.

The PMC administration has decided to continue with the concession scheme for those who pay the tax by June-end, and will also provide an additional discount of 10 percent in general tax for using solar energy, rainwater harvesting and implementing vermiculture projects to process waste.

The proposal to hike taxes comes after the PMC, on the directions of the state government, stopped the 40 percent concession that was applicable for ‘self-occupied’ residential properties for the last 49 years. The old scheme was introduced in 1971, to provide some relief to people affected by the Panshet dam tragedy.

The proposal has to be approved by the standing committee by February 20 as per the provisions of Maharashtra Municipal Corporation Act, and the committee has decided to discuss it in a special meeting