KOLKATA: The Kolkata Municipal Corporation (KMC) is set to increase property taxes by five per cent every year for those assessee who haven’t yet switched to the Unit Area Assessment (UAA) method of evaluation.
The decision by the KMC had been taken after observing that a large number of taxpayers are reluctant to switch to the UAA method of property tax evaluation and most preferred to stick to the former Annual Rateable Value method, which according to KMC, “lacked scientific and regulatory guidelines for arriving at the reasonable rent of a property depending on its location, characteristics and usage which left ample scope for “subjectivity, ambiguity and arbitrariness in the determination of tax”.
A senior KMC official said that a Bill was already passed at the winter session of the state assembly. After the recent clearance of the Bill, a notification has been finally made that will allow KMC to increase property tax by five per cent every year for those who haven’t yet submitted the Self Assessment Form (SAF). It is learnt that about 30 per cent of over 9 lakh taxpayers have switched to the UAA system of property tax.
According to the Kolkata Municipal Corporation (Amendment) Act, 2022’, a proviso has been added which states the following: “Provided that in case of non-filing of return of self assessment, notwithstanding anything contained in sections 171,179,180,232A and 232B, till the fresh valuation is made after final publication of the scheme, existing tax as mentioned in this sub-section may be increased every year, on and from the date of final publication of the scheme, by such percentage not exceeding five percent , as may be decided by the Corporation…”
A KMC official pointed out that this measure will not be seen as a penalty but just a step to build the pressure to switch to the new system of property tax payment. It was assured that once the taxpayers submit their SAF as per the UAA system the additional tax will be adjusted. The SAF is available for download at the KMC website.
KMC introduced the UAA system in 2017. Since then, the civic body has been urging tax payers to switch to the new method. Several tax payers have but complained that they find the new method cumbersome and hence prefer to continue paying taxes under the old system.