Tenants in the town could soon have to cough up more for a roof above their head as the civic body has decided to charge holding taxes at commercial rate from house owners letting out their property.

“The corporation collected around Rs 19 lakh from holding taxes in the last fiscal. But if it charges holding taxes at the commercial rate, the Muzaffarpur Municipal Corporation (MMC) is expected to earn around Rs 40 lakh,” a source said, adding that the MMC was also planning to implement the new rate on government houses.

The revenue collection is expected to start in August. The extra amount collected would be used for civic projects.

But neither the house owners nor their tenants in the town are pleased with the prospect of the new tax rate.

Rashid Choudhary, the owner of a tenement at the upscale Chandwara locality in east Muzaffarpur, told The Telegraph: “It will be an additional burden on us. I am planning to file a PIL in Patna High Court against the order.”

Tenants fear the increase in tax would cause a corresponding hike in rents across the town.

“If the corporation imposes the new rate of taxes, it will lead to an increase in rent. This is an additional burden on us,” said Akbar Ali, a tenant residing at the Rambagh area in south Muzaffarpur.

Civic authorities, however, are firm on collecting holding tax at commercial rate.

MMC commissioner Amarnath Mishra told The Telegraph: “The house owners mint money by renting out their property. The civic body has no data about the rent. The MMC had requested the state government to allow it to collect holding tax from rented houses at commercial rate.”

The state government approved the plan of the MMC last month. The new rate would be charged with retrospective effect from April 2012. Mishra also said newly elected mayor Varsha Singh has asked tax inspectors to survey and collect holding taxes from owners of rented apartments.

“The tax inspectors have been asked to complete their survey within a fortnight. House owners who have allowed mobile towers to be installed on their rooftops would also be charged holding taxes at the new rate,” he said.

Sources said the corporation had started issuing notices to house owners asking them to cooperate with the tax inspectors conducting the survey. Several civic body employees have also been deployed to assist them. The survey of ward no. 23 has been completed. There are 49 wards under the MMC.