The Karachi Metropolitan Corporation (KMC) has increased the Municipal Utility Charges and Taxes (MUCT) for industrial and commercial users from Rs400 to Rs750, a move that has been met with sharp criticism from the opposition for allegedly “violating defined legal limits.” Members of the business community have complained that they are being charged nearly double the previous amount under the MUCT.
The MUCT are collected via K-Electric (KE) bills from consumers within the KMC’s jurisdiction. The Leader of the Opposition in the City Council, Advocate Saifuddin of the Jamaat-i-Islami, has sent a legal notice to KE’s CEO, Moonis Alvi, demanding that the power utility immediately reverse the increase, which was made “unlawfully” without the approval of the elected City Council.
The notice highlighted that KE raised MUCT rates to Rs750 per month for commercial properties, despite a City Council resolution in June 2024 that fixed the rate at Rs400 per month. A subsequent proposal to increase the rate to Rs550 was deferred in 2025, and no new resolution has been passed since then. According to Saifuddin, KE, which acts only as a collection agent for KMC, has no legal authority to alter or enhance MUCT rates.
However, City Mayor Murtaza Wahab expressed his “wonder” at the opposition’s “unawareness” of the “facts and procedures.” He told Dawn that “this increase has in fact been approved by the City Council in the budget session.” Therefore, the argument that it is a violation of the rules does not stand. The Mayor stated that the increase was only for industrial and commercial users because this segment of the city is more prone to incidents like fires, which require more municipal resources.
KMC officials have claimed that no new charges are being imposed under the MUCT head. An official noted that “historically, industrial and commercial consumers were charged up to Rs5,000 under the same category.” The official added that the funds collected through this municipal tax will be used for essential services, including the fire brigade and road maintenance.
MUCT Collection and Details
In August 2024, the KMC formally notified the collection of MUCT through K-Electric. The agreement was signed in June 2022 and became effective from July 2024. According to an official, consumers receiving bills up to 100 units are exempt from the tax. Those consuming between 101 and 200 units pay Rs20, and the rate increases with higher consumption. All categories of commercial and industrial consumers were paying Rs400 each.
