Pune Citizens Oppose Increase In Property Tax

(TNN, Jan 5, 2011)

property-taxes-150x150PUNE: Citizens have come down strongly at the hike in property tax proposed by the Pune Municipal Corporation (PMC). A public meeting to voice out the grievances was organised by the citizens’ group Sajag Nagrik Manch on Sunday. RTI activists Vivek Velankar and Vijay Kumbhar were present at the meeting.

“It has been observed that the entire tax amount due with the PMC is never collected. The civic body should develop a system through which the entire due amount is collected, so that the citizens are not burdened with rising tax rates,” citizens at the meet said.

“The public should be allowed to become a part of the tax collection process. Their participation should be allowed in finding out tax thefts,

” Velankar said, adding, “In this case, the public can be reimbursed with a service charge or commission. This will help increasing the revenue of the PMC.”

The PMC has proposed increase of various taxes including property tax. Subject to approval, it is likely to be implemented from the next financial year.




Anil Pharande, CMD – Pharande Spaces


Brace For Hefty Hike In Pune Property Taxes

(TNN, Dec 26, 2010)


PUNE: Tax reforms planned by the civic administration for 2011-12 is likely to burden the citizens.The civic administration has proposed an increase in the property tax revenue by withdrawing the 40 per cent concession given to owner-occupied residential properties. There are 5,46,122 residential properties under the Pune Municipal Corporation’s purview.

In another proposal, a hike in octroi for essential commodities, including food grain and fuel, has been suggested.

In separate proposals on property tax and octroi hike which will be tabled next week to the standing committee, municipal commissioner Mahesh Zagade has said, “The PMC limits have expanded in the last few years and the population is on the rise. The PMC needs funds for development and improving the basic infrastructure like water supply, roads, sewage etc. Under the memorandum of understanding with the central government, the PMC has promised to carry out reforms and elimination of exemptions to citizens. If the exemptions in tax continue, the PMC may not get funds from the central government under Jawaharlal Nehru National Urban Renewal Mission.”

A similar proposal on a hike in civic taxes and imposition of austerity measures to tackle the weakening financial condition of the civic body is pending with elected members.

The civic chief has admitted that the annual civic budget of Rs 3,196.12 crore for 2010-2011 is in deficit and has suggested that the civic body opt for clause 104 of the Bombay Provincial Municipal Corporation (BPMC) Act.

This clause enables the municipal body to cut the expenses approved for the financial year, increase civic taxes or implement supplementary taxes.

The PMC had imposed an 11 per cent service tax hike last year, which was implemented from April 1, 2010. Also a steep hike on property tax for the IT sector is already in place since last year.

“But this is not sufficient. As per the JNNURM norms the PMC has to charge citizens for using basic services. As of now the PMC is charging little for these services. The property tax, octroi, development charges, service tax and water charges collected are insufficient. The civic administration will propose more tax reforms and it is up to political parties to decide,” said a top civic official.

He added that the central government has given strict instructions that user charges should be collected by the municipal corporations and if they failed to do so the flow of funds from central government will go dry.

Union finance minister Pranab Mukherjee, speaking at a function organised recently to mark the fifth anniversary of the launch of Jawaharlal Nehru National Urban Renewal Mission (JNNURM), had asked urban local bodies seeking central funds under the JNNURM “to bring about a change in the mindset of those who are running the institutions of urban governance and the users of urban services”.

He had said that there has to be an understanding that the goverment is not a source of endless funds. “We have to be ready to pay for the services we wish to avail for ourselves,” the minister said.

There has to be an appreciation that expenditure has to be prioritised and paced, as there can never be enough resources to meet all aspirations and an understanding that the amounts invested into urban infrastructure services are to improve our own and our children’s health, he added.

The minister said that true proof of change in the mindset will come when citizens willingly pay for services, and treat public assets as their own. It will also be visible when local governments are able to implement decisions based on a vision for sustained improvement in the quality of life and the need to support and sustain growth in economic activity, rather than on narrow short-terms gains.

However, in Pune, political parties will approach any tax hike with caution since it is an election year. Ruling party leaders have neither been open about support or opposition to the proposed tax reform moves.

Leader of the house Nilesh Nikam said that the ruling party will decide on the proposal only after detailed discussions while Congress leaders have remained silent.

Opposition parties are readying for agitation against any hike. BJP leader Mukta Tilak said that the PMC has completely failed to provide any basic service and in the given conditions the ruling party and the administration have not right to impose any tax hike.

Move To Rake In Revenue

The PMC is short of funds and has mulled a hike in development charges. According to the PMC, the construction industry has witnessed a boom in the last few years. But the development charges the builders pay the PMC have remained static. The rates are as per the Maharashtra Regional and Town Planning Act, 1966. The PMC has to seek the state government’s permission to hike these rates. In 1997-98, the civic body has submitted such a proposal which is pending. The PMC wants to hike development charges in the range of Rs 200 to Rs 250 per sq ft.

Water charges

Based on the condition that the cost of services and its recovery should be equal under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), the Union government has set the 24-hour water supply norm and also installing meters for all consumers in Pune. In his fresh proposal before the standing committee municipal commissioner Mahesh Zagade has said that water meters should be made compulsory as per the JNNURM reforms. The proposal states that 150 litres of water will be provided per head and a five-member family will be considered as a unit. If a family uses 150 litres water per head (750 litres in total) no extra charges will be imposed and the existing water rates will be charged.For every additional 1,000 litres, Rs 33 will be charged.

Pune Municipal Corporation’s Property Tax Revenue Dwindles


After remarkable success in recovery of property tax at the beginning of the financial year 2010-11, the Pune Municipal Corporation (PMC) has recorded a sudden dip in tax collection. The reason cited is shortage of staff in the property tax department.

According to sources, the department had collected Rs198 crore in April and May this fiscal, thanks to the 10% concession provided to early tax payers. However, in November the collection went down to Rs14.71 crore.

The figure was dismally low as compared to the collection during the same month in the financial year 2009-10 (Rs31.98 crore), 2008-09 (Rs27.94 crore) and 2007-08 (Rs25.9 crore). In 2006 -07, the department had collected just Rs14.11 crore.

The total collection till November this fiscal is about Rs350 crore.

Sources said that around 48% property holders paid their tax in the first two months of the current financial year. Those were the regular tax payers. However, the PMC is finding it difficult to collect taxes from the remaining property owners due to lack of manpower.

After the success of the 10% concession scheme, it was expected that the civic administration would intensify its drive to recover tax, but last month’s dismal figure has raised doubts about the PMC’s seriousness in achieving the set target of Rs606 crore.

The total property tax collected in 2008-09 was Rs355.41 crore while in 2009-10 it was Rs364.22 crore.

Property Tax: PCMC To Open New Citizen Facilitation Centres


(TNN, Dec 1, 2010)

PUNE: The standing committee of the Pimpri-Chinchwad Municipal Corporation (PCMC) has asked the civic administration to open new citizen facilitation centres (CFC) at 14 zonal offices of the property tax department.

Addressing a news conference here on Tuesday, Prashant Shitole, chairman, standing committee said, “These instructions were given during a discussion on a proposal to provide broadband facility to central stores department and CFCs at an expenditure.”

Shitole said that a proposal was tabled one and a half years ago by the civic administration to set up CFCs at the main office and the four zonal offices. “I had given an amendment motion proposing that CFCs be opened at divisional offices of the property tax department. The civic administration has failed to implement the resolution,” he said.

Meanwhile, a resolution to hike rates of water supplied to private tankers by the PCMC and the rental rates of water tankers provided by the PCMC to citizens during private programmes was also approved by the standing committee.

A civic official said that the PCMC supplies water to private tankers at the rate of Rs 110 for 9,000 litres from various places in the municipal limits like Sangvi, Chinchwad (Bijlinagar), Sector 23 and Gawlimatha, Annasaheb Magar stadium.

The current rate of water for non-residential use is Rs 30 per cubic meter. The water supply department had recommended that the rates of water supplied to water tankers needed to be Rs 270 per trip of tanker having a capacity of 9,000 litres, Rs 300 per trip for tanker having a capacity of 10,000 litres, Rs 360 per trip for tanker having a capacity of 12,000 litres and Rs 600 per trip for tanker having a capacity of 20,000 litres.

Shitole said that a resolution to construct a swimming pool at G block in MIDC area at an expenditure of Rs 1.78 crore was also approved. The proposal regarding the draft budget of school board for 2010-11 having an outlay of Rs 93.88 crore was kept pending as the members of the standing committee needed time to study it.

The draft budget will be sent to the general body for approval in December.

The standing committee approved developmental projects with a total expenditure of 1.99 lakh during the weekly meeting on Tuesday.

Pune Real Estate: Move To Double-Tax Errant Properties In PCMC Shot Down

(DNA, Nov 24, 2010)

Pune PropertyThe standing committee of the Pimpri Chinchwad Municipal Corporation (PCMC) on Tuesday rejected the civic body’s proposal of charging double property tax from those who have undertaken illegal constructions.

The civic administration had tabled the proposal before the standing committee for the approval. Now, the general body will take the final decision.

PCMC standing committee president Prashant Shitole told media persons that although the state government has issued guidelines to municipal corporations for charging double penalty for illegal constructions, the proposal has exposed the weakness of civic administration.

“If the proposal is allowed to be implemented, there would be tremendous resentment among citizens,’’ he said.

There were 14,000 illegal constructions in the PCMC limits after 2008, said PCMC assistant commissioner and property tax department head, Shahaji Pawar.

There are approximately 3 lakh property holders in the PCMC limits. The civic officials said they did not have the exact data of illegal structures in the city, but the civic body will soon start collecting information about illegal structures in the Maharashtra Industrial Development Corporation and Pimpri-Chinchwad New Town Development Authority limits also.

They said nearly 93,000 property tax holders did not complete the legal formalities of their properties, including submission of completion certificates to the PCMC.




Anil Pharande, CMD – Pharande Spaces


PCMC Collects Rs 103 Crore Property Tax

(TNN, Nov 18, 2010)

Pune PropertyPUNE: The Pimpri-Chinchwad Municipal Corporation (PCMC) has collected Rs 103.61 crore as property tax till November 13.

This is just Rs 3 crore short of the entire property tax collected in the previous year. The PCMC had collected Rs 106 crore of property tax in 2009-10 and, for the first time, had crossed the Rs 100-crore mark.

Shahaji Pawar, assistant commissioner and chief of the property tax department, said: “Targets were given to the officials and emphasis was laid on personally meeting big defaulters. The administrative officers were asked to visit people who had arrears ranging Rs 3 lakh to 5 lakh. The assistant zonal officers were to meet those having arrears between Rs 1 lakh and 3 lakh, and clerks met people who owed between Rs 50,000 and 1 lakh.”

Review meetings of zonal and administrative officials were held regularly to monitor the progress. Also, the records of 15 zonal offices were checked to verify whether bills were distributed on time and records of collections maintained, Pawar said.

The property tax bills were distributed early giving the people ample time to pay.

Pawar said that the department hoped to achieve annual collection of Rs 125 crore by March 31.

“The department will soon begin the process of seizing properties of big defaulters. They will be served notices and directed to clear their arrears. If they fail to clear the arrears, then the PCMC will auction their properties to recover the arrears.”

The PCMC has decided to charge two per cent penalty per month for delay in payment. Pawar said, “People have to pay their property tax for the first six months of the financial year by September 30. If they do not pay, two per cent fine will be collected from October 1 onwards. Tax for the remaining six months has to be paid by December 31, failing which fine will be collected from January 1 onwards.”

Thergaon zone collected the highest amount of property tax at Rs 11.44 crore by November 13, followed by the municipal office zone (Rs 11.3 crore) and Akurdi (Rs 10.69 crore). Pimprinagar had the lowest collection (Rs 1.43 crore), followed by Kiwale (Rs 1.61 crore).

Total property tax collection through online payment was Rs 4.73 crore.




Anil Pharande, CMD – Pharande Spaces


Pune Cantonment Board Proposes Property Tax Hike For Residents

(Indian Express, Nov 16, 2010)

Pune PropertyThe Pune Cantonment Board (PCB) has proposed an increase in the property tax on the residential and commercial property by nearly 10-20 per cent after it completes the assessment of properties by the end of this month.

The hike will affect nearly 12,000 residential and commercial properties in the cantonment area. According to officials, they are carrying out the assessment of the annual rateable value (ARV) of the properties in the cantonment area for nearly a year and the assessment will be complete by month end. They said the cantonment will hear objections to the proposed increase by next month before notifying an increase.

Officials said while there will be no increase in the sanitary cess but the ARV of the properties will increase nearly 10 per cent for residential houses and 20 per cent for commercial properties. Officials said they will continue with the six slabs of ARV.

As of now the percentage of property tax up to the ARV of Rs 1 lakh is 18 per cent. While the rate of property tax on the AVR of Rs 1-999 is 10 per cent, for property of AVR between Rs 1,000 and 4,999 it is 14 per cent, on Rs 5,000-29,999 it is 15 per cent, for Rs 30,000 to Rs 49,999 it is 16 per cent and Rs 50,000 to Rs 99,999 the ARV is 18 per cent. For a property with AVR above Rs 1 lakh the rate of property charged each year is 22 per cent.

“While for the old buildings, we are proposing an ARV increase of 10-20 per cent. However, we have also worked out the ARV of the fresh buildings and the new ARVs will be notified only after the assessment is complete,” said officials.

Chief revenue superintendent D V Patil confirmed that the assesment of the property was on. “ It will be complete soon before we conduct a common hearing on the objections which people may have on the proposed increase of the ARV,” he said.

However, the PCB members insisted that the cantonment board should increase the ARV only reasonably. “The increase should not hit hard the common man while the revenue collection of the cantonment board is also not affected,” said PCB member Aarti Mahajan.

PMC Approves 2% Fine For Property Tax Defaulters

(TOI, Oct 26, 2010)

PUNE: The general body (GB) of the Pune Municipal Corporation (PMC) on Monday approved the state government’s notification to impose a 2 per cent penalty on property tax defaulters.

On May 31, 2010, the state government had issued a notification authorising the civic body to impose the fine every month if property tax was not paid in a given period of time.

Property tax for the first six months of the year has to be paid before September 30. Those who fail to do so will now have to pay a 2 per cent penalty on the tax amount every month till the tax is paid. The second instalment of the property tax has to be paid before December 31 every year.

In the last two years, the PMC has brought nearly 80,000 properties under its tax net. However, an estimated 45,000 properties still remain out of its reach. The standing committee has repeatedly told the administration to make an effort to widen its tax net. Once the unassessed properties are covered, the civic body is expected to get an additional revenue of Rs 100 crore to 150 crore.

Widows, Minor Children Of Ex-Servicemen In PCMC To Get Property Tax Concession

(Times of india, Oct 21, 2010)

PUNE: The general body of the Pimpri-Chinchwad Municipal Corporation (PCMC) on Wednesday approved the resolution offering property tax concession to widows of ex-servicemen, and their minor children. The concession, at present, is limited to ex-servicemen.

Nationalist Congress Party (NCP) corporator, Mangala Kadam, cited that though the houses of the ex-servicemen were in the names of their wives and children, they did not get any concession in property tax. Kadam then tabled a supplementary amendment to extend the benefit to the widows and children also.

The general body has approved the supplementary amendment to give 50 per cent concession in property tax to the widows and their children, below 18 years of age. The concession is applicable only for areas measuring up to 1500 sq ft.

The general body also approved the resolution to charge 20 per cent more from patients coming to Yashwantrao Chavan Memorial Hospital from outside the municipal limits.

Some corporators observed that though PCMC spends around Rs 32- Rs 35 crore a year on the hospital, it lacked many facilities. NCP corporators Azam Pansare and R S Kumar demanded that staff vacancies be filled soon.

Independent corporator Maruti Bhapkar demanded that PCMC ask the state government to bear 50 per cent expenditure on YCMH as it takes in patients from Junnar, Khed, Maval, Mulshi and other nearby talukas.

Mayor Yogesh Behl asked the civic administration to list staff requirements and send it to the municipal commissioner for approval. A separate meeting to discuss matters related to YCMH will be held later.

Behl expressed concern about corporators tabling large number proposals of supplementary amendments. “There are 12 proposals on the agenda of the general body, but the corporators have tabled 25 supplementary amendments. This shows that the corporators do not attend the zonal committee meetings. Proposals of supplementary amendments will not be accepted from the next general body meeting”.

PCMC Announces Cash Awards To CWG Medalists

The general body has approved a resolution to give Rs 2.5 lakh cash award to Commonwealth Games gold medalist Aneesa Sayyad and Rs 1 lakh to silver medalist Vikram Pillay. Corporators demanded that the rules regarding cash awards be relaxed so that players can be given the awards directly instead of presenting them through sports organisations. Behl asked the civic administration to table a proposal to amend the rules in the next general body meeting.

PMC Losing Rs 150 Cr Property Tax Annually For Lack Of Draftsmen To Measure Building Plans

(Pune Mirror, October 20, 2010)

Can the property tax collection of Pune Municipal Corporation (PMC) get a boost just by inducting some draftsmen on staff? Yes, if one goes by the proposal by some corporators. A proposal before the standing committee of PMC states the civic body needs more draftsmen to increase the revenue.

Corporators Sanjay Nande and Shrikant Pujari have put forth this proposal. According to them, “The city is witnessing an explosion in constructions. The tax department is responsible for taxing them, so collection will see a boom.”

Property tax is levied in accordance with the area of the building. Since draftsperson can measure the area correctly, they are needed in the tax department. However, most of the draftsmen are currently in the building department, they said. Hence, they have recommended some draftsmen be hired.

The PMC has various pending tax complaints. The civic body has to recover Rs 51 crores from 210 cases of property tax. The standing committee has also approved a committee headed by retired High Court judge R M Bapat for this purpose.

Speaking to Mirror, Nande said, “The tax department has already asked for two draftsmen to be recruited for the assessment. There are not enough technically sound persons in the department.

Builders usually show the partially completed buildings which are never assessed again. They escape the tax net easily. Hence, if a draftsman is in the department, he can calculate how much tax the PMC can collect simply by studying the plan.”

The PMC had collected property tax of Rs 274.44 crore against the estimated amount of Rs 482.82 crore in 2009-2010. During the preparation of the budget this year, the standing committee had claimed that 45,000 properties do not fell in the tax net, eroding revenue by Rs 150 crore.

Vilas Kanade said, “I know about such a proposal but do not know the exact details of it. We have started charging tax on one lakh properties, which is the highest number of properties in the history of the PMC. However, some properties escape because of lack of manpower.”

The Current System

The PMC levies property tax on buildings in three ways. First, the building department sends occupation certificate to the tax department, depending on which tax is levied. Some residents approach the PMC and declare their properties voluntarily. The third way is the manual scrutiny of the building in PMC limits.

Explaining the reasons of less taxing, Kanade said, “Sometimes, the building is ready but only two or three families are moved in. The properties can’t be taxed until they are occupied totally. Sometimes, the buildings are used rarely and other times the completion certificate does not come in time.”

However, lack of manpower does not allow the department to scrutinise all properties. According to Kanade, there are no special teams to scrutinise such properties and has to be carried out by the employees, who are not experts.