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Indian Real Estate News : Kolkata
Kolkata property tax calculation made simple
Source: The Times of India, Kolkata Oct 17, 2011
Paying the property tax from next year may pinch your pocket. But calculating it will be a breeze. You can simply pick up a pen and paper and assess your property to arrive at the tax value.

With Kolkata Municipal Corporation set to junk the century-old rent-based assessment and adopt the system of unit area assessment (UAA), valuation and revaluation of properties will become a thing of the past.

Under UAA, the city has been carved into seven zones based on not only the price of land but also civic amenities on offer. The base unit area value is high for posh areas that command premium value and have superior civic amenities. It progressively reduces as land cost and civic amenities decline.

Properties located in Alipore, Phoolbagan, AJC Bose Road etc have been categorized in 'A' with base rate of 85/sq ft while those in Metiabruz and Garden Reach are at the other end of the spectrum in 'G' category with base rate of 15/sq ft.

Apart from the base rate, several other factors like location in terms of major roads, nature of the property, occupancy status and age of the building need to be factored in to calculate the tax. This is to ensure that houses that are next to major roads attract more tax than those in alleys. Similarly, those residing in condominiums that have modern facilities like swimming pool, club etc will have to cough up more than twice the tax of a flat without any such amenities. Owners of properties that are older than 20 years can avail of some concession. Also, tenanted properties will attract twice the rate of tax applicable for properties in which only the owner and his/her family lives.

For instance, Mr XYZ residing in Sakherbazar, Behala (F category), currently pays Rs 1,500 as property tax for his 800 sq ft flat under the existing rental value method. Once the UAA is in force, he will have to pay 10% of the base value multiplied by the flat size and values assigned to each factor. If his own apartment in a 21-year-old building (A2) located next to a major arterial road (L1) offers no special amenities (S4) like swimming pool or club, the tax will be 10% of 20 (base value) × 1.2 (location MF value) × 1 (structure MF value) × 1 (occupancy MF value) 0.8 (age MF value) or 1,676.80.

KMC officials want to introduce the UAA from next April. Municipal commissioner Arnab Roy is scheduled to notify the adopted policy early next week. The proposal will be placed in the KMC House on October 22 for approval. Tax payers will be given a month’s time to express their opinion on the new system before it is notified. "We hope to introduce the new UAA method by April 2012," said a KMC revenue department official.

For those who feel the pinch of a huge jump in tax rates, there is a hardship committee to take note of the grievances and consider deferred payment. The committee comprises the mayor and 10 members of his council. Debabrata Majumdar, an MMiC and member of the anomaly review committee, felt tax payers in middle income group were unlikely to be hit hard. "We hope to augment revenue by spreading the tax net. But at the same time, we have spared the lower middle and middle class from the tax burden," he said.

According to one of the members of the municipal valuation committee which formulated the parameters of the new method of taxation, there is still scope to make changes to the proposed system if there are valid suggestions or objections in future.

HOW TO CALCULATE THE TAX

Multiply the base unit area value of the locality in which the house/flat is located with the covered area or floor space. This is to be multiplied by the various multiplicative factors (MFs) — location, structure, occupancy status and age. The annual tax will be 10% of the amount that is arrived at.
Tag: kolkata real estate, Kolkata property tax
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