Schools may have to pay tax at commercial rate

6th December 2010 0 By Journalist Jaspal Singh Naol

Schools may have to pay tax at commercial rate

The Navi Mumbai Municipal Commissioner has announced that a new resolution will be brought in for collecting more taxes from educational institutions by changing their property tax rates from residential to commercial.
There are more than 200 primary, secondary and higher secondary schools functioning within the limits of Navi Mumbai Municipal Corporation. The majority of these schools are owned by political leaders. Almost all the schools have received land from the City and Industrial Development Corporation at subsidised rates. However, there are hardly any schools that do not collect capitation fee under the name of building fund, raise fees in the name of VI Pay Commission etc. While when it comes to paying taxes to NMMC, they pay at subsidised rates.
At the Standing Committee meeting held recently, corporators Shivram Patil and Dashrath Bhagat raised the issue. “It is really funny to see that the city has all types of schools from SSC board to CBSE to ICSE to IB which are charging fees way beyond the pocket of a common man. It is obvious that they are openly doing commercial activity and yet NMMC is colleting property tax at the rate of residential complexes, they observed.
“Is it so that this is being done due to some higher political pressure?” they asked.
Municipal Commissioner Vijay Nahata responded saying, “We will be formulating a resolution which will bring all schools under commercial category. Once the General Body gives its sanction we will be collecting their property tax as per the rates of commercial complexes instead of residential”.
A property tax official informs that the difference schools will have to pay will be at the least double the present rates.
Sana Shaikh, a parent reacts, “We are afraid that if there is a rise in property tax of schools, it will be recovered through fee hike and in effect parents like us will have to bear the burden. Hence NMMC must ensure that the same does not happen”.