Micro-Zoning, RR proposal: A reform opportunity

Mumbai: The government’s proposed introduction of micro-zoning and differentiated Ready Reckoner (RR) rates marks a significant shift in the way property valuations are determined across the state. The initiative, which seeks to assign distinct RR rates to high-rise buildings, slums, chawls and redeveloped properties within the same locality, has largely been welcomed by the real estate sector. Industry stakeholders, however, caution that the reform’s effectiveness will depend less on its...

min read

Micro-Zoning, RR proposal: A reform opportunity

Mumbai: The government’s proposed introduction of micro-zoning and differentiated Ready Reckoner (RR) rates marks a significant shift in the way property valuations are determined across the state. The initiative, which seeks to assign distinct RR rates to high-rise buildings, slums, chawls and redeveloped properties within the same locality, has largely been welcomed by the real estate sector. Industry stakeholders, however, caution that the reform’s effectiveness will depend less on its intent and more on the framework governing its implementation. The proposal comes at a time when property markets in major urban centres, particularly Mumbai Metropolitan Region (MMR), are witnessing increasingly diverse development patterns within the same neighbourhoods. Experts argue that uniform RR rates often fail to capture the substantial variations in infrastructure quality, redevelopment status, accessibility and market demand that exist even within small geographical pockets. Real estate professionals believe that a micro-zoning approach could help bridge the gap between official property valuations and actual market realities. More accurate valuation mechanisms can improve transparency in transactions, provide a fairer basis for stamp duty calculations and create a more nuanced framework for urban planning. Experts’ Comments Kamlesh Thakur, President, NAREDCO Maharashtra and Co-Founder & Managing Director, Srishti Group, believes the concept has merit but warns that the execution framework will determine whether the reform succeeds or creates fresh challenges. “The concept of micro-zoning and differentiated Ready Reckoner rates has the potential to make property valuation more reflective of local market realities and development potential. However, its success will depend entirely on the framework adopted for implementation. Unless there is a clear, transparent and objective policy with well-defined parameters, the introduction of micro-zoning could lead to increased discretion at the administrative level, resulting in uncertainty and inconsistent outcomes,” he said. According to Thakur, valuation systems that allow excessive room for subjective interpretation can generate disputes, create inconsistencies in assessments and undermine business confidence. His concerns reflect a broader industry apprehension that redevelopment projects—already burdened by lengthy approval processes and rising costs—could face additional uncertainty if valuation criteria vary across administrative jurisdictions. Kaushal Agarwal, Chairman, The Guardians Real Estate Advisory, views the proposal as a logical evolution of property valuation practices, particularly in rapidly transforming urban markets. “The move towards differentiated Ready Reckoner rates through micro-zoning is a progressive step, as property values can vary significantly within the same locality depending on factors such as infrastructure, accessibility, building quality and surrounding development. If implemented effectively, it has the potential to make property valuations more realistic and aligned with actual market dynamics,” he said. Transparency, Methodology At the same time, Agarwal emphasized that transparency and data quality will be critical to ensuring credibility. “However, the success of this initiative will depend on the transparency of the methodology, the quality of data used, and the consistency of its application across micro-markets. Buyers, investors, and developers value clarity and predictability in valuation mechanisms. A well-defined and publicly accessible framework will be essential to avoid ambiguity, strengthen market confidence, and ensure that the new system delivers greater accuracy without creating uncertainty in transaction pricing or investment decisions,” he noted. Uniformly Implemented Echoing similar concerns, Dhruman Shah, Promoter, Ariha Group, said the government must ensure that the system remains easy to understand and uniformly implemented. “The move towards micro-zoning reflects an effort to modernize property valuation and make it more representative of actual market conditions. However, it is important that the system remains simple, transparent and uniformly enforced across regions. If multiple layers of interpretation emerge during implementation, it could lead to disputes and delays, particularly for redevelopment projects that already involve complex approval processes. Industry consultation at every stage will help create a practical and effective framework,” Shah said. As the state explores one of the most significant changes to its property valuation mechanism in recent years, the industry appears broadly supportive of the objective. Yet the consensus remains clear: the success of micro-zoning will depend on transparency, consistency and stakeholder consultation. Without these safeguards, a reform intended to improve valuation accuracy could inadvertently introduce new layers of uncertainty into an already complex real estate ecosystem.

The Funding Gap in India's Fight Against Tobacco

Arun Vijay
Jun 2
3 min read

India earns over Rs 73,000 crore annually from tobacco taxes, yet dedicated spending on tobacco control remains a fraction of that.

On World No Tobacco Day, observed on May 31, governments worldwide renew their commitment to combating tobacco use. This year’s WHO theme, “Unmasking the Appeal — Countering Nicotine and Tobacco Addiction", highlights industry tactics that attract young users.

In India, this occasion also offers an opportunity to reflect on the complex balance between tobacco tax revenues and investments in tobacco control.

Every year on May 31, the global community focuses on reducing tobacco-related harm. While the tobacco industry’s marketing strategies deserve scrutiny, India faces its own policy challenge: substantial revenue from tobacco products alongside the need for stronger prevention and cessation efforts.

According to official figures, taxes from tobacco products (including GST, excise duty, cess and other levies) contributed around 2.2 per cent of India’s gross tax revenue in 2023-24. In recent years, annual collections have hovered near or above Rs 73,000-76,000 crore.

This revenue supports various public programmes, yet it also underscores a longstanding policy paradox. The National Tobacco Control Programme (NTCP), the Centre’s flagship initiative for tobacco cessation and enforcement, receives relatively modest funding. Analyses, including from the National Institute of Public Finance and Policy (NIPFP), indicate annual allocations often remain below Rs 50 crore — a small fraction of the revenue generated. While taxation itself serves as a tool to discourage consumption by raising prices, the gap in dedicated spending on enforcement, awareness and cessation services merits attention.

Grassroots Enforcement

While the national picture shows a funding gap, the challenges of grassroots enforcement become evident through recent state-level decisions, such as those in Maharashtra.

A recent example illustrates this challenge. On May 22, 2026, Maharashtra’s Public Health Department issued a government resolution providing Rs 2,000 per taluka annually to taluka-level coordination and monitoring committees. Formed in 2023 under the Cigarettes and Other Tobacco Products Act (COTPA), these committees aim to strengthen enforcement at the local level.

Maharashtra has approximately 358 talukas. The total allocation for these committees thus comes to around Rs 7.16 lakh per year. While the intent behind creating taluka-level bodies is commendable — bringing enforcement closer to villages and towns — the modest financial support highlights the resource constraints faced by such initiatives. The committees are expected to handle awareness, monitoring and enforcement tasks, often by integrating with existing meetings of the Taluka De-addiction Committee under the Social Justice Department.

Broader Picture

This situation is not unique to Maharashtra. Nationally, data from 2015-16 to 2022-23 shows that only about 38 per cent of approved NTCP funds were utilised. Factors include limited staffing, training gaps and infrastructure challenges at district and sub-district levels.

Maharashtra has achieved notable success in reducing cigarette consumption and ranks high on certain tobacco-control indicators, yet utilisation of NTCP funds has historically been modest.

According to the Global Adult Tobacco Survey (GATS-2, 2016-17), around 267 million adults (28.6 per cent prevalence) use tobacco in some form. Although prevalence has declined since the previous survey, the absolute numbers remain significant, calling for sustained, well-resourced efforts.

The World Health Organization recommends that taxes should constitute at least 75 per cent of the retail price of tobacco products. In India, the tax incidence on cigarettes is approximately 53 per cent, as noted by Finance Minister Nirmala Sitharaman in Parliament.

Recent policy changes, including the Central Excise (Amendment) Bill, 2025, aim to maintain revenue stability while adjusting duties. Public health experts have long suggested exploring earmarking a portion of tobacco taxes specifically for control programmes, cessation centres and school-based awareness drives.

Way Forward

On World No Tobacco Day 2026, India will reiterate its commitment to a tobacco-free future. Symbolic observances are important, but lasting progress depends on strengthening implementation machinery.

Enhancing utilisation of available funds, building capacity at the taluka and district levels, and ensuring better coordination between health and revenue departments could help bridge existing gaps. The Rs 2,000 per taluka allocation, while limited, represents a step towards decentralised action. With additional support through training, monitoring mechanisms and integration with broader non-communicable disease programmes, these committees could become more effective. Many states, including Maharashtra, have demonstrated that focused efforts can yield results in reducing consumption.

Tobacco control involves multiple dimensions: taxation, enforcement, awareness and support for cessation. Aligning fiscal policy more closely with public health goals remains an ongoing policy challenge. A balanced approach that sustains revenue while progressively investing in prevention and de-addiction could better serve both economic and health objectives.

(The writer is a senior journalist. Views personal.)