Exactly a year after announcing the plan, the Mahayuti government has fulfilled a key election promise by approving a draft ordinance to abolish the Non-Agricultural (NA) tax and permission system in Maharashtra. The landmark decision, cleared by the state cabinet on Tuesday, marks a major step toward streamlining land development and reducing bureaucratic hurdles.
Once ratified by the state legislature and approved by the Governor, the ordinance will become law, officially putting an end to the long-standing system that required landowners to seek NA permissions from revenue authorities.
The reform allows citizens and developers to submit their land development proposals directly to local planning authorities instead of approaching the district collector — a move aimed at eliminating delays and red tape that have plagued the process for decades.
In addition to scrapping the NA permission requirement, the cabinet has abolished the Sanad system, which previously required references to the Revenue Department even in cases where such permission wasn’t mandatory. The duplication under Sections 42(a), (b), (c), and 44-A of the Maharashtra Land Revenue Code (1966) often led to the same delays as obtaining NA permission itself.
Under the new system, the government has replaced the annual NA tax with a one-time premium based on Ready Reckoner (RR) valuation:
- 0.10% for plots up to 1,000 sq. m
- 0.25% for plots between 1,001 and 4,000 sq. m
- 0.50% for plots above 4,001 sq. m
The Revenue Department clarified that the premium will be collected once, replacing the yearly NA tax burden on landowners. For properties with NA permission granted on or before December 31, 2001, the premium will be based on the RR valuation of 2001. For permissions granted on or after January 1, 2002, it will be calculated based on the valuation applicable at the time of building permission.
Importantly, the department has also stated that no recovery of NA tax arrears will take place until all legislative amendments come into effect — providing much-needed relief to landowners and developers.
The reform is being hailed as a landmark policy shift that simplifies land development in Maharashtra and aligns with the government’s broader push toward ease of doing business in the state.
