Buying a flat or shop near Metro or Monorail?
Are you planning to buy a new flat near Metro line, Monorail line or any other major infrastructure project in Mumbai? If yes, then be ready to cough up an additional 10 % additional development tax on property transactions in such areas.
The residential and commercial properties could get costlier as the state government is contemplating a 10% development tax on property transactions in such areas. The logic is that properties in these areas will command a premium once the projects come up.
Chief minister Prithviraj Chavan has asked the Mumbai Metropolitan Region Development Authority (MMRDA) to send a proposal to the state planning commission on how this tax should be levied. The move comes after the MMRDA complained that its resources were getting depleted and there were no new avenues of revenue generation.
The MMRDA plans an initial one-time 10% development tax on the ready-reckoner value. This tax will have to be paid while registering the property in new developments or existing structures. While 7% of the tax is likely to go to the MMRDA, the remaining 3% will go to the civic body. A final decision on the move will be taken by Chavan, said the sources.
However, the move has evoked a strong reaction from home buyers. Prakash Ojha, who is looking to buy property near Pratiksha Nagar Sion from where Mono rail passes, said, “ In fact, no Development tax should be levied at all as all such services are already chargeable. Already salary classed employees are paying more than their portion as taxes which are deducted at source, hence such a move is despicable, he added.
“It will be very cruel, unfair and inhuman if development tax is levied in addition to the other duties and taxes like stamp duty, registration, vat and service tax”, said Suresh Mirajdar, an executive working with an MNC in Goregaon. Instead of imposing this tax on new home buyers, it should be spread over the entire population in the form of increase in the monthly maintenance tax payable by all the flat owners.
Agrees Monal Patil: the benefits of the development like monorail, metro line , mumbai trans harbour link is for all and not only for the new home buyers. If it is a burden then it should be passed on to all and not the new entrant only. Old residential flat owners already have the advantage of having bought the property at lower rates and majority of the existing home owners need not necessarily be the actual users and can also be investors. The government should look at it from the point of view of the new property owners, she said.
