In a city as dynamic and ever-evolving as Mumbai, keeping abreast of regulations that impact your property is essential. This is especially true regarding property tax, which affects homeowners and investors alike. Whether you are evaluating residential projects in Mumbai or considering a new purchase, understanding the MCGM Property Tax system is key to making informed decisions. At Dynamix Group, as one of the leading real estate developers in Mumbai, we strive to keep homebuyers updated with all the vital details.

What is MCGM Property Tax?

The Municipal Corporation of Greater Mumbai (MCGM), also known as the Brihanmumbai Municipal Corporation (BMC), levies an annual property tax under the Municipal Corporation Act of 1888. This tax applies to all property types—commercial, residential, and industrial—within the city’s jurisdiction. The revenue collected funds the development and upkeep of civic amenities such as roads, sanitation, water supply, and public infrastructure. Prompt payment is therefore not only a legal duty but also supports the enhancement of your local community.

Components of MCGM Property Tax

Property tax calculation depends on several key factors:

-- Ready Reckoner Rate: The government-assessed base value of the property.

-- Age and Condition: Newer properties or recently renovated ones may have different taxation.

-- Sewerage and Water Tax: These are supplementary charges included in the calculation.

-- Annual Rental Value (ARV): The assigned value by local authorities for taxation.

Hike in MCGM Property Tax for FY2025–26

After a decade, MCGM has revised its property tax bands, resulting in increased bills for over 900,000 property owners. Effective 1 April 2025, ready reckoner rates have risen by an average of 3.89%, causing property tax rates to range between 8–20%, depending on the location. The revision, initially slated for 2020 but delayed by the Pandemic, was necessary to support the city’s growing infrastructure. The new hike is expected to help the BMC achieve its Rs 5,200 crore revenue target for FY2025–26.

Due Date and Rebates

The deadline to pay your MCGM Property Tax is 30 June each year. Early payment may qualify for rebates between 2–5%. However, late payments incur a penalty of 2% per month on the outstanding amount.

Penalty on Unauthorised Properties

To combat illegal structures, BMC has introduced a 200% penalty under Section 152(A) of the Mumbai Municipal Corporation Act. Between April 2024 and March 2025, 3,343 unauthorised properties—mainly in the western suburbs—were collectively fined Rs 392.28 crore.

As responsible developers, we at Dynamix Group strictly adhere to all municipal guidelines and encourage all customers to remain informed and compliant.

Who is Exempt?

The MCGM provides several tax exemptions:

Residential units up to 500 sq. ft. — 100% exemption.

Units between 501–700 sq. ft. — 60% reduction in tax.

Properties for charitable or religious use.

These exemptions especially benefit first-time buyers and senior citizens seeking more compact homes in prime areas.

Property Tax and Your Investment: Why It Matters

If you are contemplating a new home, understanding MCGM Property Tax is just as important as evaluating location, carpet area, and amenities. Whether searching for a 2 BHK in Thane, 3 BHK in Malad East, or the best projects in Andheri or Dahisar, tax liabilities differ based on locality, unit size, and property age.

As trusted real estate developers in Mumbai, we believe that buying a property goes far beyond square footage. It is about understanding every facet of the purchase—including obligations like MCGM Property Tax. With recent updates and stricter enforcement, knowledge is your best protection—safeguarding your investment and enabling peace of mind.

Whether you are a first-time buyer or an experienced investor, staying abreast of property taxation and choosing only compliant, reputable projects can dramatically impact your long-term satisfaction and returns. At Dynamix, our commitment is not just to build homes, but to foster trust, integrity, and enduring value for every client.