Bangalore Property TaxProperty owners in Bangalore City will have to switch over to the new method of property tax assessment — Capital Value based assessment System (CVS) — from the next financial year (from April 1, 2008) instead of the existing Annual Rentable Value (ARV) based assessment. However, those who have put up new structures, renovated or extended existing buildings after June this year and those whose property tax assessment is due, will have to pay tax under the CVS with immediate effect, that is from October 1, 2007.

And, those staying in the limits of seven CMCs that were merged with the Bangalore City, during the formation of the Greater Bangalore, will have to pay a higher property tax from next year depending upon the tax levied by the respective CMCs under the CVS before the merger.

A decision in this regard was taken by the administrator of the Bruhat Bangalore Mahanagara Palike (BBMP) on September 29, 2007.

Barring Bangalore City, all other municipalities adopted the CVS system almost two years ago.
“Property owners, assessed to property tax, in all the six city municipal councils (CMCs) which were merged with Bangalore City to form Bruhat Bangalore, have been paying property tax based on the CVS. The BBMP cannot have two different methods to calculate tax structure under one authority.”

Moreover, the CVS system was introduced in 2004 in the entire State by abolishing ARV system and the BBMP has to fall in line, said BBMP Commissioner Dr S Subramanya.

While clearing the apprehension that CVS will increase the property tax burden, he said that a majority of people owning properties in Bangalore City will end up paying a little less when compared to the present tax structure, which was fixed indiscriminately by the revenue officers. He also clarified that the property owners will have to file property tax returns under the Self Assessment (SAS) method and the BBMP will provide them with handbooks to help them calculate the tax under the CVS.

However, all those properties which are not assessed to property tax and major industrial establishments like IT and ITES and other non-residential properties situated in the jurisdiction of panchayats before the formation of the BBMP would be paying considerably higher tax from next year, he added.

CATEGORY-wise rates

*Residential: 0.5 pc (50 pc discount if self-occupied)
*Industrial properties: (including IT and ITES) - 1 pc
*All other non-residential properties - 2 pc
*Vacant land - Up to 1,000 square metres - 0.2 pc
*From 1,001 sq mts to 4,000 sq mt - 0.05 pc
*Above 4,001 sq mts - 0.02 pc
*The rates will also apply to all areas included under the BBMP while forming Greater Bangalore
Source: Deccan Herald, Thursday, October 25, 2007