KARACHI: Just eight months after its implementation, the Karachi Metropolitan Corporation (KMC) is considering raising Municipal Utility Charges and Tax (MUCT), which is collected through electricity bills, by up to 100 per cent.
“Financial status” of the local government and “development projects” in the city were cited as reasons behind the proposal which has come up with the agenda disbursed by the KMC to the members of the City Council for its upcoming session due on April 21, where it would seek approval of the house to implement the revised structure of the MUCT.
The KMC had formally notified the MUCT in Aug 2024 and started collection of the tax through KE bills. Both the KMC and the power utility had originally signed an agreement in June 2022 which had finally become effective from July after the City Council approved the levy of the charges.
According to the agreement, the KE is collecting the MUCT from its domestic and non-domestic consumers living within the jurisdiction of the KMC through their monthly power bills. The consumers are being charged as per category, which was notified by the KMC.
KMC proposes 100pc hike in MUCT; opposition in City Council slams plan
Among other items, one of the six-point agenda issued by the KMC for the April 21 meeting says that the City Council will be seeking the nod of the house to increase the MUCT and propose the revised structure linking it with the electricity consumption, with varying rates based on usage.
As per the proposed plan, electricity consumers using up to 50 units will be exempted from paying municipal charges. However, those consuming between 51 and 200 units will face a municipal charge of Rs50, marking an increase of Rs30 from previous rates.
The consumers using between 201 and 300 units will pay Rs100, following a Rs50 hike. Similarly, those consuming between 301 and 400 units will be charged Rs200 after a Rs100 increase. For the users consuming between 401 and 500 units, the charges will rise by Rs100 to a total of Rs225. In the 501 to 600-unit category, a Rs125 hike will bring the charges to Rs275.
The proposal also includes an increase for those using between 601 and 700 units, who will pay Rs300 after a Rs125 hike. The consumers exceeding 700 units will face a steep rise of Rs450, bringing their total municipal charges to Rs750. In addition to the residential consumers, the proposal outlines fixed municipal charges for different categories: Rs600 for general services, Rs550 for commercial consumers and Rs750 for industrial users.
The proposal has sparked a strong backlash from the opposition in the City Council, which claims its earlier warnings about the MUCT are now proving right.
“Our stance on MUCT has always been clear,” said Saifuddin Advocate, opposition leader in the City Council. “We are already pursuing this matter in court. From the outset, we warned the people of Karachi and the judiciary that the MUCT slab system was nothing more than a deceptive tactic that would eventually lead to increased charges. Unfortunately, our concerns are now becoming reality.”
He further criticised the “burden of excessive taxation,” saying that the people of Karachi are already weighed down by multiple federal and provincial taxes.
“And in return, what do they get? Crumbling infrastructure, a failing water and sewerage system and an almost non-existent waste management system. We categorically reject this proposal and will strongly oppose it in the upcoming City Council session,” he vowed.
Published in Dawn, April 18th, 2025
