Mumbai Property Tax Hike Up to 15%: Here’s What You Need to Know
The Brihanmumbai Municipal Corporation (BMC) has increased property tax by up to 15% for the year 2025-26, affecting over 9 lakh properties in Mumbai. However, some areas are experiencing even higher hikes.
Mumbai Property TaxBmcProperty Tax HikeReady ReckonerResidential PropertiesReal Estate MumbaiMay 29, 2025
According to the new rules, a flat owner who paid Rs 10,000 in tax last year will now have to pay Rs 11,500. However, the actual increase varies depending on the ready reckoner (RR) rate of each locality. The RR rates are used by the government to assess property value for tax and stamp duty purposes. The recent rise in RR rates was a key factor in the revision of property tax.
Several residents have reported steeper increases in some areas. For instance, a flat owner in Andheri West saw his tax jump from Rs 29,211 to Rs 36,898, a 26% hike. Similarly, a resident from Bandra West experienced a 23% increase, with his bill rising from Rs 1.10 lakh to Rs 1.36 lakh.
Despite the widespread increase, around 3.6 lakh residential properties of 500 sq ft area remain exempt from property tax, as per a 2017 state government decision. The last property tax revision happened in 2015-16, and the current hike marks the completion of a five-year cycle, making it the right time to increase rates.
Earlier this year, in March 2025, the government raised RR rates by an average of 3.39%, which had already hinted at a possible property tax hike. Despite the increase, BMC has not changed its collection target of Rs 5,200 crore for 2025-26. Officials are still evaluating how the hike will affect overall revenue.
Critics, however, have raised concerns about the timing and fairness of the tax increase. Former Bandra West corporator Asif Zakaria called the hike 'alarming,' especially since BMC has been running without elected representatives for the past three years. He also criticized the delay in implementing a new tax system based on the capital value of properties.
Zakaria pointed out that the courts had directed changes to certain rules (20, 21, 22), which could reduce property tax bills by as much as 40% for the years 2010 to 2025, but no action has been taken. Mumbai North Central MP Varsha Gaikwad slammed the BJP-led state government for what she called a 'brutal' 13-20% hike. She said the hike violates Supreme Court orders, as BMC began issuing new tax bills without fixing the capital value rules or reassessing taxpayers.
In summary, while BMC claims a 15% rise, many residents are seeing much steeper hikes and are questioning the timing and fairness of the move. The impact of this tax increase on the city's residents and the overall revenue collection remains to be seen.
Frequently Asked Questions
What is the maximum increase in property tax for 2025-26 in Mumbai?
The maximum increase in property tax for 2025-26 in Mumbai is up to 15%.
Which areas in Mumbai are experiencing the steepest hikes in property tax?
Some areas like Andheri West and Bandra West are experiencing steeper hikes, with increases of 26% and 23%, respectively.
Are there any properties exempt from the new tax slab?
Yes, around 3.6 lakh residential properties of 500 sq ft area remain exempt from property tax, as per a 2017 state government decision.
Why was the property tax hike implemented now?
The property tax hike was implemented to complete a five-year cycle, as the last revision happened in 2015-16, and a review was due in 2020. The pandemic and political issues delayed the process.
What is the BMC's collection target for property tax in 2025-26?
The BMC's collection target for property tax in 2025-26 is Rs 5,200 crore.
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