PUNE, June 27, 2025 – The Pune Municipal Corporation (PMC) is grappling with a significant revenue shortfall, reportedly losing around ₹350 crore compared to last year’s property levy, primarily due to persistent issues in tax recovery from properties within 32 newly merged areas. This delay is severely impacting the civic body’s overall revenue generation.
Residents of these recently integrated areas have vehemently demanded a reduction in property tax rates, citing concerns over a dramatic increase in their tax burden. While the state government has imposed a cap, limiting property tax to a maximum of twice what residents paid under their respective gram panchayats before the merger, the PMC claims that the “nitty-gritty of the implementation” has not been adequately worked out by the state.
According to PMC officials, the state has yet to provide clear directives on rateable values and other formulas for calculating rates, leaving the civic body to charge property tax using standard methods. This lack of clarity, coupled with widespread non-payment from property owners, has severely limited revenue generation.
Activists further highlight that complications arising from the implementation of a 40% tax rebate linked to PT3 forms have also adversely affected PMC’s income. Ujwal Keskar of Aaple Pune, Apala Parisar organisation, noted that “Many property owners are getting tax discounts because of issues related to PT3 forms despite being eligible to get the benefit. The administration should give more time for paying the tax at the discounted rates.”
Residents express apprehension about paying increased property tax, particularly as the civic administration’s proposed rates are significantly higher than what they previously paid. For instance, while gram panchayats charged approximately ₹2 per square foot annually, the civic body’s charge of ₹2 per month effectively pushed the annual amount to around ₹24 per square foot after the merger with PMC – a tenfold increase. This sharp hike is expected to recur in 23 additional villages slated for merger.
Minister of State for Urban Development Madhuri Misal confirmed on Thursday that the PMC has been directed to submit a fresh proposal to the state government concerning property tax calculations for these merged areas, as citizens are not ready to accept the current tax structure.
PMC data reveals a substantial increase in the city’s property base. Prior to 2017, the civic areas encompassed around 8.5 lakh properties. After the merger of 11 villages, this number rose to approximately 10 lakh. With the recent merger of 23 more villages, nearly 2 lakh properties have been added to PMC’s tax ambit, bringing the total number of properties within PMC limits to 12 lakh.
In response to the challenges, the state on Wednesday issued new directives to introduce an amnesty scheme for merged locations. A senior PMC official expressed hope, stating, “Many property owners, who have not paid tax yet, will pay their dues by the end of month to avail themselves of the benefit of tax discount. The civic administration hopes to see an increase in revenue in next three to four days.” The administration’s earnings dropped from approximately ₹1,350 crore till the end of June 2024 to ₹1,000 crore this year.
