The Indian Express 24.09.2013
MC: Pay property tax from September 27 onwards
After much dilly-dallying, get ready to pay property tax from September 27 onwards.
With the ordinance for the amendment to the Punjab Municipal Act, 1911, and the Punjab Municipal Corporation Act, 1976, getting a nod from the Punjab Governor, the property tax is all set to make people pay for living in their own homes.
Not only the construction on a property will add to the tax but also the people who pay tax after the time prescribed by the MC will have to witness auction of their properties.
As per rules formed by the government, everybody owning either a residential home, commercial property or even a vacant plot has to pay property tax because they own a property.
However, residents feel that it is nothing less than dictatorship. Pradip Mehta, a resident of Model Town, said, "What is the meaning of this tax after paying water and sewerage bills? Let MC do what they want but I will not pay."
"Is it anything less than dictatorship to pay for owing a property? Why only tax from property owners?" questioned Ramesh Singal from Aggar Nagar.
HDFC teams
AT a crucial meeting of MC, headed by MC Commissioner Rahul Tewari and Mayor Harcharan Singh Gohalwaria, additional commissioners, zonal commissioners, superintendents and other staff members who will be involved in collection of property tax from September 27 onwards were given strict orders to recover maximum tax by October 31.
While the MC has set a target of collecting at least Rs 200 crore by the end of this financial year, it has roped in teams of HDFC Bank which will help MC in recovering the tax and spreading awareness. Also, tax money will be kept in HDFC accounts. "HDFC teams are our partners in this mission and they will be visiting from block to block to help us recover tax," Mayor Gohalwaria told Ludhiana Newsline.
Self-assessment
The formula adopted by the government is of self-assessment. According to this, people themselves will fill out proformas which are expected to be available at MC offices, suvidha kenders, online and at sub-zonal offices. They will be required to write details like area of their property and construction done, and submit forms along with tax as per self-assessment.
"Till October 31, 10% rebate will be given to encourage people to pay tax. Then till December this year, there will be no rebate and in quarter following December, a penalty of 25% will be imposed on those who will not pay tax and then finally last resort will be auctioning the property," said Gohalwaria, adding that "tax is very citizen-friendly and no one should have a problem in paying such nominal amount".
Wrong information
Asked how MC will come to know if residents file wrong information, Gohalwaria did not have a clear view and said that a "detailed copy of rules is yet to be received from government". He added that "MC may inspect and cross- verify forms of residents randomly, not all, and then penalty might be imposed".
How to calculate?
Houses of up to 50 square yards = Rs 50 per year
Houses between 50 and 100 sq = Rs 150
For houses with an area of 500 square yards or more, payment is to be calculated at a rate of one per cent of the annual value. For vacant plots and unutilised buildings and plots, tax will be 0.2 per cent of the annual value.
Total value will be calculated by adding collector rate to the construction cost (Rs 500 per square foot on covered area) to arrive at its total value and then deducting 10 per cent as depreciation charges for residential houses. Thereafter, five per cent of the total value of the property will be taken as the annual value of the property on which the tax will be calculated.
For houses between 100 and 500 square yards, the tax will be charged at a rate of 0.5 per cent of the annual value.
