Property tax is a local tax the municipal corporation imposes on property owners or tenants. The revenue generated from, say Mumbai property tax, helps fund civic services and infrastructure development across the city. The amount calculation for MCGM property tax in Mumbai is based on several factors, including the property's location, type (residential, commercial, or industrial), built-up or carpet area, the building's age, and the current tax rates set by the municipal corporation.

Keep reading to learn more about what property tax is in Mumbai and how to pay Mumbai property tax online.

What is Property Tax in Mumbai?

MCGM property tax refers to the property tax Mumbai property owners pay annually to avail themselves of basic public amenities. It is levied by the Municipal Corporation of Greater Mumbai (MCGM) in India. The MCGM, also known as the Brihanmumbai Municipal Corporation (BMC), is the civic body responsible for governing the city of Mumbai.

MCGM Property Tax Formula

The MCGM property tax in Mumbai is calculated using the capital value system. This method uses the property’s market value per the ready reckoner rates to determine the tax. The formula for MCGM property tax in Mumbai is:

Property Tax = Capital Value x Property Tax Rate.

We will see the details of MCGM property tax and capital value calculation in the next section.

How is MCGM Property Tax Calculated?

As seen earlier, the Mumbai property tax is calculated using the Capital Value System (CVS), which is based on the property's market value. To calculate your Mumbai property tax online, follow these steps:

• Visit the Mumbai property tax calculator on the MCGM website.
• Fill in details like ward number, floor, building type, carpet area, zone, user category, year of construction, FSI factor, and more in the MCGM property tax calculator.
• Click 'Calculate' to generate your comprehensive MCGM property tax bill.

Capital value is calculated as:

Capital value = Market Value of property x Total Carpet Area x Weight of Construction Type x Weight for Age of Building

Market Value

It is determined by Ready Reckoner (RR), which the state government has established to find justifiable property value in Mumbai. Identifying the specific ward/zone that corresponds to your property is essential.

Weights for Construction Type

• Bungalows and RCC construction: 1 unit
• Non-RCC constructions like semi-permanent structures and chawls: 0.60 units
• Under-construction properties or vacant land: 0.50 units

Weights for Age of the Building

• Properties built before 1945: 0.80 units
• Properties built between 1945 and 1985: 0.90 units
• Properties built after 1985: 1 unit

The Mumbai property tax is then calculated using this formula:

Property Tax = Capital Value x Property Tax Rate x Weight for User Category.

Weights for User Categories

• Hotels and businesses: 4 units
• Commercial properties: 3 units
• Industries and factories: 2 units
• Residential and charitable institutions: 1 unit

How to Pay MCGM Property Tax Online?

To pay Mumbai property tax online, you need to access the MCGM website and follow the steps outlined below:

• Visit the MCGM/BMC website to pay MCGM property tax in Mumbai.
• Access Citizen Services and Select Property Tax.
• Within the website, locate the "Citizen Services" section and choose the "Property Tax" option. This selection will direct you to a new page.
• Log in to the website using your property account number. Additionally, input the captcha for verification.
• Once logged in, your property details will be presented. Verify the accuracy of these details and indicate the amount of property tax. The property tax payment sequence adheres to the First-In-First-Out (FIFO) principle. You can pay using net banking, credit cards, or debit cards.
• A receipt will be generated upon completing your online Mumbai property tax payment. Ensure that this receipt is retained for future reference and record-keeping.

Following the above steps, you can pay your MCGM property tax in Mumbai online without any issues.

Exemptions  From Payment of Mumbai Property Tax

Certain types of properties are exempted from paying MCGM property tax in Mumbai. Thorough knowledge of these exemptions can help property owners reduce their tax liability. Below are the critical exemptions:

• Properties used for public purposes, such as places of worship and charitable trusts, are exempt from MCGM property tax in Mumbai.
• Properties smaller than 500 square feet receive full exemption from MCGM property tax in Mumbai.
• Flats or houses with a floor area between 500 and 700 square feet receive a 60% discount on MCGM property tax.

Delayed Payment And Penalties

Property owners must pay their Mumbai property tax by June 30th each year. Failure to meet this deadline results in a 2% monthly penalty on the outstanding MCGM property tax amount.

Timely payment of Mumbai property tax is crucial for funding essential city services and infrastructure development. Knowing what property tax is in Mumbai helps property owners recognise their civic responsibilities and the importance of paying it on time.

Latest News On MCGM Property Tax 

BMC has announced that it will not revise the MCGM property tax rates for the 2024-25 fiscal year. This decision comes after previous attempts to increase rates in 2020-21 and 2022 were unsuccessful. Since the removal of octroi and its replacement by GST in 2017, property tax remains a critical revenue source for the BMC.

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Conclusion

All Mumbai property owners are liable to this MCGM property tax. Before you make any financial decision with respect to buying a home or piece of land in Maharashtra, be aware of all such legal bindings.

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