Maharashtra Govt to Levy 0.5 Percent Cess on Property Tax
The setting up of the Maharashtra Municipal Property Tax Board (MMPTB) was a condition of the 13th Finance Commission for releasing a Rs 1,100-crore grant to the state. The MMPTB will be expected to audit tax assessments by municipalities, recommend action in the event of incorrect valuation, settle property tax disputes and design procedures to improve transparency in valuation.
The state government plans to levy a 0.5% cess on the general component of property tax. The proposal is of the urban development (UD) department, which wants to establish the MMPTB and fund its activities. The cess will be collected by municipalities and remitted to the government. The proposal has been put before chief minister Prithviraj Chavan, who also holds the UD portfolio.
The state legislature had passed a bill for setting up the MMPTB during the budget session. A senior official said the provision for the cess had been included in the bill, which received the governor’s assent on April 21.
The MMPTB will use the grant from the levy to provide salaries and allowances to its members and employees, and meet other expenses. The urban development department has projected an initial expenditure of Rs 3 crore to set up the board. The board will be headed by a retired Supreme Court or high court judge or by a retired chief or additional chief secretary. The other members (a minimum of four) will be experts in municipal administration and property valuation. The cess will be in addition to ones pertaining to trees, education and repairs. Also factored in property tax calculations are water and sewage benefit taxes.
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