Revised PPT on Property Taxes

8/7/2019 Revised PPT on Property Taxes

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Property Taxes

BBMP has proposed to increase the

property taxes by 15%

The reason is resource crunch which ishindering the development works in the

city

Let us examine the issue and see

whether it is a reality or a Myth


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Property Taxes

- The normal sources of revenue for BBMP are

- Property taxes

- Rental Income

- Advertisement Taxes- Trade License, Building Plan

Sanction, Road Cutting Charges

- Grants and Loans from State

and Central Governments

- Grants under SFC


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Property Taxes

Revenue Potential (in Rs Crores)

- Property Taxes - 2250.00

- Rental Income - 500.00- Advertisement - 300.00

- Licensing - 250.00

- Grants & Loans 500.00

- SFC Grants 4000.00

Total 7800.00


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Property Taxes

Property Tax:

- It is estimated that only 40% of the propertiesare paying taxes amounting to Rs.900.00 crores.

- The full potential is therefore about Rs. 2250Crores

Property Rentals:

- There are more than 1000 BBMP properties let

out for commercial purposes. At the presentmarket rates they can collect at least Rs.500.00crores


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Property taxes

Advertisement Tax

- The outdoor hoardings can easily fetcharound Rs. 300 crores per annum. Presentlymost of the hoardings are illegal

Grants and Loans:

- The state and central governments under

various schemes extend loans and grants tourban local bodies. This can easily amount to

Rs. 500.00 crores at the least


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Grants under SFC

- The total tax collection under various

headings like Income Tax, Sales Tax, ServiceTax, Excise Duty, Property Registration duties

etc by both the State and central

Governments amount to nearly Rs.50,000.00

crores per annum from Bangalore

Property Taxes


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Property Taxes

- Out of this if they allocate about 8% to BBMP

it amounts to Rs. 4000.00 crores. This will be

in tune with the devolution of funds as

envisaged under the 74th amendment to the

Constitution of India. In fact when Octroi was

abolished it was promised that the loss of

revenue would be made up by the StateGovernment which has never been fully kept

up.


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Property Taxes

WHATWEWANT

- Revert to 5 year revision block for revisingproperty tax rates

- Update the Property Register as mandatedunder KMC Act

- Bring at least 90% of the properties under

the tax net- Revise the rentals of all BBMP properties intune with the present market rates


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Property Taxes

- Bring all the illegal hoardings under the

advertisement tax net

- Create an awareness among the Senioradministrators of BBMP about the various

schemes of State and Central governments

and get grants under them.


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Property Taxes

Prepare a white paper highlighting the taxcollection from BBMP area by both the Stateand Central Governments under various

heads and place it before the Sate financeCommission and demand a devolution of 8 to10% of the taxes collected

All these may take 2 to 3 years but it willcertainly yield the desired levels of revenuefor BBMP.


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Property Taxes

All these measures can bring in the desired revenue

for BBMP

A probable road map could be as follows:

- 1st year 50% 3900.00 Cr

- 2nd Year 70% 5460.00 Cr

- 3rd Year 80% 6240.00 Cr

Let us also remember that BBMP does not have thecapacity to handle projects beyond Rs 1000 Cr at

present. There is an urgent need to build the capacity

of BBMP to handle larger amount of projects.


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Property taxes

- WHAT THE CITIZENS EXPECT FROM OURCORPORATORS & MLAs

- Our corporators should pass a resolution tothe effect that the block period for revision ofProperty taxes should be restored to 5 yearsas earlier and an updated Property Registershould be prepared by BBMP and send theresolution to the State Government fornecessary action


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Property Taxes

- Our MLAs elected from the 28 AssemblyConstituencies of Bangalore shouldpressurize the State Government to bring in

suitable amendments to the KMC Act- Further the BBMP administration should beasked to prepare the necessary White paperon proper devolution of funds to BBMP fromthe State Government and the same shouldbe placed before the SFC


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Property Taxes

ROLEOF RWAs

- All RWAs should take up the task of creating

the necessary awareness among their areaMLAs and Corporators through personal

meetings and public interactions on a ward

wise basis. This is very essential to create the

required political will for implementing the

above measures.


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Property Taxes

THANK YOU

Revised PPT on Property Taxes

Documents

Transcript of Revised PPT on Property Taxes