Payoshi Bisht, Pune
Property experts have anticipated a sharp climb in rental rates for house seekers within the Bangalore city. This is a coordinated result of the guidance value tax collection framework being proposed by the local metropolitan body, Bruhat Bengaluru Mahanagara Palike, or BBMP. The proposal is likely to shoot up as of now taking off property costs within the city.
In accordance with the proposition, the guidance value or circle rates of a specific region alludes to the least cost of any property set by the government. One of the key changes within the policy is that the modern assessment rates for the proprietors of the leased properties will be set at 0.2 percent of the current direction values for the leased properties and 0.1 percent for the self-occupied ones.
They added that the new proposal would require owners to pay more in taxes than they currently do. Last October, the state government raised the state’s guidance values by an average of 25% to 30%. The goal was to reduce the difference between the guidance value and the actual property price. However, experts noted that after guidance values rose last year, some areas of the inner city’s suburbs, where property prices tend to be lower, have actually seen guidance values rise above actual property prices.
Another significant effect will be an overall rise in property tax since in many cases the properties are sold below the guide value, said Anil Kalyani, President of Bangalore City flat Owners’ Welfare Association.
BBMP officials said the move will enhance tax collection efficiency and streamline the system. However, they added that implementation will start only in the next fiscal year. In the proposal, property tax will be increased by 5 percent on April 1 each year starting from 2025.
The Karnataka Home Buyers Forum (KHBF) has expressed its concerns to the government about the new tax policy. Dhananjaya, the President of KHBF further added that in case the property taxes go up by 5 percent every year, there is a risk that property prices and rent prices will become a burden for the middle-class citizens. The body also asked the state government to take into account the carpet area, which is the actual usable space in a property, when calculating the taxes.