The GHMC is ready to issue the draft notification for new property tax for commercial and residential properties in the next few days. This means that citizens will have to pay enhanced rates even if the sugar-coated bitter pill of one month’s rent is being proposed to be collected instead of the usual 30 per cent of annual rental value.
What the Municipal Corporation is not saying aloud is that the new rates will conform to the current rentals in different areas even if the type of construction, age, location, usage, and so on, is taken into consideration. Thus, the tax rate will be obviously high -- double or more than what was being paid till now.
Rental info collected
In the last six months, its staff have scoured the 18 circles and collected rental information from 20 per cent properties after sub-dividing these into 10-12 zones in each. Pouring through the data, officials have realised that rental values rose by more than 100 per cent in recent years, while municipal records showed “abysmally low” values.
“The last big exercise for residential properties was way back in the late 90s under the self-assessment scheme, which too had its deficiencies. Over the years, arbitrariness has crept in due to misuse of discretionary powers resulting in several anomalies in assessing tax rates irrespective of location and usage. We are going to remove these discrepancies with the current rationalisation,” explain senior officials.
For instance, senior officials say that the property tax rate was hovering between 40 paise and Re.1 – Rs.1.20 without much differentiation between the areas like Banjara Hills, Jubilee Hills, Khairatabad, Marredpally, Kukatpally and others, including slums.
The latest draft suggests property tax rates in the band of Rs.3.75 – Rs.1.80 per sq.ft and anywhere between 80 paise and Rs.1.40 for slums depending on the various parameters listed above.
Senior officials claim that property tax rates will drop by 30 per cent in areas such as L.B.Nagar, Malkajgiri and parts of Kukatpally under rationalisation. The tax rate of commercial properties too could dip by 20 per cent in some areas as inherent defects in the system will be corrected.
Second meeting
Though GHMC Commissioner M.T. Krishna Babu has all the powers to revise the tax every five years (last revision happened in 2007, if only for commercial properties) and need not take the council’s approval, a second meeting is scheduled with floor leaders and the Mayor to take them along. The objective is to push it through before the financial year ends in March after taking the suggestions and objections.
