BMC is India’s richest civic body. Here’s how it earns, spends, and who runs Mumbai without corporators

Octroi is gone, but the cash keeps flowing. Here’s the BMC’s real revenue playbook, its spending priorities, and the power shift after the elected house ended.

• BMC's proposed budget for FY 2025–26 is Rs 74,427 crore, its highest ever
• Capital expenditure dominates, with Rs 43,162 crore for infrastructure projects
• BMC lacks an elected body since 2022, sparking accountability concerns.

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On paper, the Brihanmumbai Municipal Corporation is a city government. In practice, it is one of the largest spending authorities in the country, with a budget that now rivals, and in some cases exceeds, that of smaller Indian states.

That’s why the BMC election is never just a civic contest. It’s a fight over a Rs 74,000-crore balance sheet, and over who decides how Mumbai is built, repaired, flooded, cleaned, and moved.

But the real story is not just size. It’s how this money is raised, where it is being spent, and who has been making these decisions without an elected civic body in place since March 2022.

First, the headline number

For FY 2025–26, the BMC has proposed a budget of Rs 74,427 crore, its highest ever, according to the civic body’s budget documents.

Of this, capital expenditure alone accounts for about Rs 43,162 crore, nearly six out of every ten rupees the corporation plans to spend.

Bigger than states, richer than cities

To put the scale in perspective:

Goa’s total budget for 2025–26: Rs 28,162 crore

Arunachal Pradesh: Rs 39,842 crore

Himachal Pradesh: Rs 58,514 crore

Sikkim: Rs 16,196 crore

Tripura: Rs 31,412 crore

Mumbai’s civic body alone plans to spend more than all of them.

Among cities, the contrast is even starker. Delhi’s Municipal Corporation operates on about Rs 16,500 crore, Bengaluru’s BBMP on roughly Rs 19,900 crore.

That scale explains why the BMC has long been described as India’s richest municipal corporation, and why control over it carries political weight far beyond ward boundaries.

Where BMC earns its money

Contrary to popular belief, the BMC does not run mainly on property tax.

Its income is spread across taxes, fees, state transfers, and investment income, a structure that has quietly reshaped civic politics after GST.

1. Compensation in lieu of octroi: The biggest pillar

Before GST, Mumbai collected octroi at its borders. After the octroi was scrapped, the state government began compensating the BMC for that loss.

In FY 2025-26, this state compensation remains one of the single largest revenue lines, estimated at around Rs 14,000-15,000 crore, as per budget estimates reported by The Indian Express.

A large part of 'Mumbai’s money' now flows via the state government, tying the city’s finances more closely to state-level politics than most voters realise.

2. Property tax: Important, but not dominant

Property tax continues to be a core revenue source, but it is far from the biggest.

For FY 2025-26, the BMC has projected around Rs 5,200 crore from property tax, according to budget summaries.

That’s significant, but it is still smaller than state compensation and capital-linked inflows.

3. Development fees and premiums: The real urban cash machine

A growing share of BMC revenue comes from development plan charges, building permissions, and FSI-linked premiums.

These non-tax revenues were estimated at nearly Rs 6,000 crore in recent fiscal years and continue to be a major income line, as reported by Indian Express.

4. Fees, licences, and advertising

• The BMC also earns from:
• Licensing fees
• Hoardings and outdoor advertising
• Permissions and penalties For FY 2025–26, advertising and license-linked revenue is projected to be in the hundreds of crores, with advertising alone expected to exceed Rs 300 crore, according to a report by Exchange4Media.

5. Interest income from fixed deposits

The BMC has historically parked large surpluses in fixed deposits, earning steady interest income every year.

However, RTI-based reporting cited by Mint and Indian Express shows that BMC’s fixed deposits have declined sharply since FY22, as funds are increasingly deployed into infrastructure projects.

In simple words: The safety cushion is thinning as spending accelerates.

Where BMC spends its money

This is where the election stakes become obvious.

1. Infrastructure dominates everything

The single biggest spending bucket is capital expenditure, Rs 43,162 crore in FY 2025–26. This covers:

• Roads and concretisation
• Stormwater drains and flood mitigation
• Sewage and water infrastructure
• Bridges, flyovers, and traffic works
• Coastal and climate-resilience projects

• Rs 5,545 crore for the Mumbai Sewage Disposal Project, including seven new sewage treatment plants slated to come online between 2026 and 2028
• Rs 4,000 crore for Phase 2 of the Versova-Dahisar coastal road
• Rs 3,111 crore for citywide road concretisation
• Rs 1,958 crore for the Goregaon–Mulund Link Road tunnel project
• Rs 1,516 crore for completion and maintenance of the south Mumbai coastal road

2. Day-to-day civic services

The second major bucket is revenue expenditure, which keeps the city running:

• Sanitation and solid waste management
• Public hospitals and health services
• Primary education
• Water supply operations
• Salaries and pensions

These are less glamorous than flyovers, but politically explosive when they fail.

3. Grants to city services, especially BEST

The BMC provides major financial support to the Brihanmumbai Electric Supply and Transport (BEST) undertaking.

For FY 2025–26, Rs 1,000 crore has been earmarked for BEST, according to Financial Express. Since 2012-13, cumulative BMC support to BEST has crossed Rs 11,000 crore.

The administrator years, and the accountability gap

All this spending has happened without an elected civic body.

Since corporators’ terms ended in March 2022, Mumbai has been run by an administrator. During this period, RTI-based investigations have shown that over 99 percent of local development funds were sanctioned to constituencies held by ruling alliance MLAs, with opposition-held areas receiving almost nothing.

The execution record hasn’t helped. Large capital budgets routinely go underutilised, often less than 45 percent spent in a year, while bridge projects, road works, and hospital upgrades miss deadlines.

Opposition parties have labelled recent budgets 'infrastructure-heavy but outcome-light.'

Whoever wins the BMC will inherit a record outlay and a long list of civic promises Mumbai has heard before. The only thing that will matter after the votes are counted is delivery.