PUNE: The civic budget for 2025-26 went up by Rs 1,017 crore with revenue from building permissions and property tax as the mainstays.
Redevelopment of properties in the old city areas, projects in the new areas and a share of revenue from PMRDA construction approvals are expected to boost revenue from building permissions.
Pune Municipal Corporation‘s (PMC) administrator Rajendra Bhosale on Tuesday presented a Rs 12,618.09 crore budget, up from the Rs 11,601 crore in 2024-25.
Hefty funds were also earmarked for roads, water supply, sewage treatment and development of merged areas. Each received at least Rs 1,500 crore, an indication that the civic election later this year may have prompted the allocations.
For the first time, PMC expects more income from building permissions as against its traditional top revenue source of property tax. No hike in property tax was proposed.
The civic budget has set a target of Rs 2,899 crore from building permissions as against Rs 2,847 crore from property tax collection for 2025-26.
Bhosale said, “We have told PMRDA to give us a larger share of their building permissions to us. We expect to get it this year. It is going to boost our revenue.”
This share, amounting to around Rs 600 crore, is due because PMRDA approves building construction in the merged areas where PMC provides civic amenities.
An official said redevelopment projects across the city and construction in the Transit Oriented Zone (TOD) are gathering pace. High rises too with 4 FSI are coming up.
These factors will generate more revenue from building permissions. Besides, the civic body has introduced an intelligent work managment system to speed up the process for bulding permissions.
The administration will also step up recovery of property tax and get financial aid from the state and Union govts. These form the other sources of income.
Bhosale said, “We have reached out to the state and Union govt for financial aid. The civic administration is also hoping for special grants as PMC is celebrating its diamond jubilee this year.”
The administration will also focus on tax recovery from cellphone towers besides bringing new properties under the tax net.
Property Tax From Merged Parts Remains A Grey Area
PMC earned Rs 6,500 crore till January 2025 and hopes to reach up to Rs 8,500 crore by March-end.
Building permission department officials said the department earned Rs 1,900 crore from permissions and development charges so far and around Rs 500 to Rs 600 crore more is expected by March-end. PMC also received around Rs 300 crore from PMRDA as its share of building permissions for the current fiscal.
However, there is no clarity on the collection of property tax from merged areas since the state government’s directive last year before the assembly election.
The letter ordered PMC to halt property tax collection from these areas, suggesting that residents be levied only two times the tax that was being charged by the gram panchayats. If recovered as per the normal tax rates, the PMC will get Rs 200 crore from the merged areas.
Additional commissioner Prithviraj B P said, “We will not send the tax bills to property owners in the merged areas. We have written to the state for clarification. PMC will soon send bills to other properties.”
PMC expects Rs 1,633 crore through govt fundings, Rs 2,700 crore via GST, and revenue of Rs 545 crore from Local Body Tax.
“Though the LBT department will be scrapped as per the state govt directives, the civic administration will continue to pursue recovery cases. The administration will follow up with defaulters,” Bhosale added.
Suggestions and objections from the people and politicians were included while drafting the budget. Elected representatives and former corporators put forth work proposals worth Rs 30,000 crore.
