The BMC will not levy direct taxes on Mumbaikars for the next fiscal year 2019-20.
Mumbai: The Brihanmumbai Municipal Corporation Monday earmarked Rs 4,151 crore for health and Rs 2,074 crore for primary education besides allocating funds for a number of infrastructure projects in its Rs 30,692-crore budget for 2019-20.
The BMC will not levy direct taxes on Mumbaikars for the next fiscal year 2019-20. However, as the BMC revenue collection in the property tax and development plan (DP) department has taken a hit due to the slowdown in the real estate sector, the civic body is planning to make up for these losses by levying service charges and entry fees on various corporation facilities.
In addition to this, the BMC has earmarked Rs 5,199 crore from its reserved funds to finance major infrastructure projects.
Civic chief Ajoy Mehta Monday presented a Rs 30,692 crore budget for the year 2019-20, which is higher by 12.60 per cent (Rs 3,704 crore) than the 2018-19 budget of Rs 27,258 crore.
He allocated Rs 11,480 crore for capital expenditure on development projects like roads, storm water drains, bridges, solid waste management, and water supply in the budget.
Total establishment budget size stood at Rs 11,946 crore, which is 48 per cent of total revenue.
“In 2018-19, the income from property tax was estimated at Rs 5,206 crore and it has come down to Rs 5,016 crore in 2019-20. Besides the slowdown in real estate leading to a decrease in the assessment of new properties, the issue of imposing capital value tax has also affected revenue collection. As per the high court direction, only 50 per cent of increased property tax can be charged due to the transition in the tax system. In view of the change in share and premium rates of fungible FSI and premium paid FSI, we anticipate a drop in revenue from the DP department. In addition to that, a slowdown in the property sector is also likely to have an adverse impact on DP department collections,” Mr Mehta said.
“To increase revenue, the BMC intends to levy service charges and entry fees on various corporation facilities of international standard like the zoo, gardens, Shilpagram among others as it takes large funds to raise these facilities,” he added.
According to civic officials, the major source of revenue in this year will be from grant in aid on account of compensation in lieu of octroi (Rs 9,073 crore), property tax (rs 5,016 crore), DP department (Rs 3,453 crore), interest on investment (Rs 2,332 crore) and water and sewerage charges (rs 1,459 crore).
From its fixed deposits of more than Rs 70,000 crore, the BMC has decided to withdraw Rs 5,199 crore to finance its major infrastructure projects.
“The funds have been linked to various infrastructure projects to ensure that they are funnelled towards capital expenditure to improve the city’s infrastructure,” Mr Mehta said. Of these projects, the BMC has allocated rs 1,600 crore to the Mumbai Coastal Road and Rs 100 crore to the Goregaon-Mulund Link Road.
Other major projects are expansion of K.B. Bhabha Hospital-Bandra (rs 10 crore), redevelopment of Bhagwati Hospital (Rs 40 crore) and construction of medical college building in Cooper Hospital (Rs 35 crore). They also include development of a textile museum (Rs 15 crore), upgr-adation of Deonar abattoir (Rs 20 crore) among others.