Non-agriculture tax reduced from 3 per cent to 0.5 per cent

The government on Saturday, February 10, 2018,  decided to reduce non-agriculture (NA) tax from three per cent to 0.5 per cent of the ready reckoner value. Revenue Minister Chandrakant Patil announced it following a meeting with residents associations from Mumbai and Thane, led by Mumbai BJP chief Ashish Shelar seeking relief in NA tax.

Patil said, “The government will bring down NA tax from three per cent to 0.5 per cent of the ready reckoner rate.” According to Shelar, “The decision would provide a huge relief to people specially in Mumbai and Thane.”

Earlier, the revenue department is in the process of slapping notices to nearly 20,000 housing soceties, commercial establishments in the district including the lake city and Navi Mumbai for recovering nearly Rs 500 cr collectively as non agricultural tax for the current fiscal. The sudden levy of this tax has drawn ire from activists and political parties.

The revenue department under the provisions of the Maharashtra Land Revenue Code has been authorised to collect NA tax on all lands annualy that have been used for any other purposes other than farming. The rates of each of these lands is different based on its usage. The owners of these lands are expected to pay the taxes annualy at the revised rate set by the collector office. The target for the district is Rs 500 cr while that for the Thane taluka is Rs 295 cr.

The levy, surprisingly, was not charged by the department earlier and the sudden inclusion of the same since the previous fiscal has apparently caught the land owners unawares who have been slapped with penalties for the pendning dues.

Mr. Dayanand Nene, President, Alert Citizens Forum has thanked Mr. Chandrakantdada Patil and Mr. Ashish Shelar for the relief provided to the people.

Earlier, Housing societies and properties in Bandra, Khar and Santacruz were among the worst hit. Some were asked to shell out non-agricultural tax of over Rs 80 lakh.

The state revenue department has stayed a massive hike in non-agricultural (NA) tax for housing societies and other properties in the suburbs after a furious reaction from residents who had received demand notices.

The tax, which is applicable to properties that came up on former farm land, was increased by over 1,500 per cent. Housing colonies in Bandra, Khar and Santacruz were among the worst hit by the rate jump. Some were asked by the collector to pay over Rs 80 lakh.

more than 10,000 families were facing huge tax demands until revenue minister Chandrakant Patil imposed a stay on Tuesday. Patil took the decision after Bandra West legislator and BJP leader Ashish Shelar met him following remonstrations by residents’ groups. The minister has asked additional chief secretary (revenue) Manukumar Shrivastav to rationalise the NA tax.

“This is a big victory for citizens. It was not fair to ask them to pay such high NA tax. We want the government to rationalise the NA tax and find a long-term solution to this burden,” Shelar said.

Under the Maharashtra Land Revenue Code, 1966, non-agricultural tax is imposed in areas which were recognised as agricultural zones outside gaothans and where there is nonfarming activity. It is levied over and above the property tax.

The NA tax was negligible until February 2008. In 2009, the state issued a notification to link it with the ready reckoner rate, which is decided by the government as per the market value. In 2010, the state stayed NA tax collection briefly. But the revenue department started issuing fresh notices to housing societies last month and demanded that they also pay the tax for the period when it was stayed.

Residents staying along the 137 gaothans of Bandra, Andheri and areas up to Dahisar saw their NA tax bill rise by 1,000 per cent. Those who used to pay Rs 500 earlier were asked to shell out Rs 20,000 as per the ready reckoner rate.

In 2009, the then revenue minister Narayan Rane said that NA tax should be scrapped as most areas earlier identified as agricultural zones were now proper urban localities. The revenue department collects NA tax every five years.

The tax for three plots of Salsette Catholic CHS in Bandra was earlier Rs 44,553 for five years. After the recent hike, the figure rose to a staggering Rs 81,37,787. Societies that were charged Rs, 4.82 per metre before saw their rate increase to Rs 73.8 per sq metre.

Shelar said he would urge the government to withdraw the tax entirely. “Residents should be asked to pay only a one-time tax and this issue must be resolved. I will take up the issue with the revenue minister again. For now, there is some relief for residents,” he said.

A senior official with the revenue department said the government was working on an exit strategy for the tax. “A one-time fee could be collected at the time of issuing building permissions.