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In a significant move aimed at streamlining property tax recovery and reducing disputes, the Brihanmumbai Municipal Corporation (BMC) has secured approval for an amendment to Section 154 of the Mumbai Municipal Corporation Act, 1888. The bill has been passed by both the Maharashtra Legislative Assembly and the Maharashtra Legislative Council.

Relief for property owners, no additional tax burden

The civic body clarified that the amendment will not lead to any increase in property tax for residential or commercial property owners. Instead, it is designed to simplify the assessment mechanism while providing relief to taxpayers.

A key change under the amendment is the exclusion of Floor Space Index (FSI) from land tax assessment. This is expected to remove long-standing complexities in valuation and give a push to both stalled and ongoing real estate projects across Mumbai.

Major administrative relief, fewer disputes

One of the most impactful outcomes of the amendment is that nearly 10.5 lakh (1.05 million) properties within the BMC jurisdiction will no longer require reassessment dating back to 2010. This is likely to significantly reduce administrative workload and help avoid prolonged legal disputes between property owners and authorities.

Clearing the way for pending dues recovery

The amendment also addresses pending tax liabilities linked to a 2014 interim order of the Bombay High Court. Under that order, many property owners had been paying only 50 percent of their property tax.

With the revised legal framework now in place, these property owners will be required to pay the remaining 50 percent, enabling the civic body to recover long-pending dues.

Boost to civic and state revenues

Officials said the amendment will strengthen the BMC’s ability to collect outstanding property taxes more efficiently. In addition, it is expected to facilitate the recovery of pending revenues owed to the state government.

BMC warns of property seizure for tax defaulters ahead of March 31 deadline

Meanwhile, The Brihanmumbai Municipal Corporation (BMC) has issued a strong warning to property owners across Mumbai, stating that strict penal action – including immediate attachment and seizure of properties – will be initiated against those who fail to clear pending property tax dues before the March 31, 2026 deadline.

The civic body has stepped up its recovery efforts in the final days of the financial year, urging taxpayers to comply and avoid enforcement action. Officials have been instructed to make concerted efforts to achieve the set tax collection targets within the stipulated timeframe.