Soon owners of paying guest accommodations in the city, which have more than 12 units, will have to obtain trade licences.
The Bruhat Bangalore Mahanagara Palike (BBMP) council, which on Friday passed a resolution in this regard, has also decided to classify PG accommodations as commercial buildings, which means they will have to pay property tax at commercial rates.
The issue was raised during the last month’s council meeting by N.R. Ramesh, councillor of Yediyur. He said there are more than 8,000 PG hostels in the city and classifying them as commercial building would add Rs. 60 crore every year to the civic body’s coffers. Interestingly, the BBMP’s Revenue Department said in the meet that there are only 272 PG hostels in the city, with Rs. 31.17 lakh collected in property tax every year from the owners.
Presently, PG hostels are classified as tenanted accommodations under the self-assessment scheme. The BBMP’ s Standing Committee for Taxation and Finance had also recommended trade licence for PG accommodations and that owners should pay tax at commercial rates depending on the zonal classification.
BBMP officials added that the process of issuing trade licences for PG accommodations would begin after a formal approval from the government.
