In order to generate more revenue, the civic body was considering to double property tax on hostels and paying guest facilities by charging commercial rates.
The Pune Municipal Corporation (PMC) administration would table a proposal before the civic standing committee and bring about the changes from the next financial year. Primary estimates said around 400 such properties would be subjected to changes in property tax rates.
Tax rates are defined based on the annual rateable value (ARV). The ARV of land or building open to property tax is the annual rent at which it could be let out from year to year. After the change of rates, the amount of tax on these hostels and paying guest facilities would be doubled.
Several citizens opposed the idea and said it would increase the financial burden on students.
Head of PMC’s property tax department Ajit Deshmukh said, “We studied policies of other civic corporations like Navi Mumbai and Brihanmumbai. Authorities are charging commercial rates from hostels and paying guest facilities.”
Officials said the civic administration had started a survey of properties near educational institutes and would give notices to these properties. The range of cot-basis systems starts from Rs3,000 to Rs8,000. Paying guests have to give Rs7,000 to Rs15,000 depending upon the locality.
Working bachelor Vinayak Renewad said, “The rates of rental facilities went up drastically after Covid, making it difficult to manage expenses. If students and bachelors are burdened more, their daily life will be adversely affected. Most of us get limited salary or money from home.”
“Many students from drought-prone areas come to Pune for studies. They are already reeling under poor finances and managing somehow. If commercial rates are charged, we have no option but to raise rent. The added pressure will make it difficult for the students to survive in the city,” said Bharat Waghole, a hostel owner in Sadashiv Peth.
Former corporator of PMC Nilesh Nikam said, “Pune is a big educational hub. The student population is large, as is the floating population of bachelors. It plays a significant role in the growth of the education sector.”
Nikam said the administration had given special discounts to IT and ITMS firms to promote the industry in Pune and it was taxed at residential rates. The same principle should be applied to hostels, since these are ultimately used for residential purposes.
