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Home owners to get option between two tax systems
August, 28th 2014

To augment revenue and give relief to property owners, the Kolkata Municipal Corporation (KMC) is set to introduce the much hyped Unit Area Assessment (UAA) system. Even better, the civic authorities will give an option to tax-payers to choose between the current General Revaluation (GR) system of assessment and the new UAA system, though civic officials admitted that it will be an uphill task to manage both simultaneously.

A change has been proposed in the GR system, too. Under this system, the KMC assessment department currently sends an inspector to re-assess a particular property (residential or commercial) in gaps of six years. The KMC assessment department takes note of the additional constructions and hikes the tax accordingly. If no renovation or additional construction has taken place, the KMC enhances the annual valuation of the building by 10%. The property owner has to pay tax (annual) that is equivalent to 40% of the annual valuation of the property.

Now, the KMC authorities propose to start a fresh GR at a gap of three years instead of six. Then, the rate at which the civic body will enhance the valuation will be reduced to half of the existing 10%, that is 5%.

A special resolution in this regard was brought to a mayor-in-council meeting on Wednesday which was discussed and passed. The resolution will be sent to the state government for approval.

However, a section of the KMC assessment department officials felt that it would be an uphill task for the civic body to offer such an optional scheme to tax payers. According to a senior KMC official, since the KMC Act was amended in 2006 to introduce the UAA system and the amendment clearly stated that all other assessment systems in vogue (including the present GR system) will be abolished, the present civic board is in no position to offer tax payers an option between the two.

Debabrata Majumdar, the MMiC who was made the head of a high-power committee to determine the UAA system, sounded a caution at Wednesday's meeting, mayor Sovan Chatterjee was reportedly keen on a fresh amendment giving tax payers the option between the two.

The special resolution, which was drafted at the eleventh hour to include it in the MIC meeting, also sought to give relief to house owners who have rented out their buildings and are now burdened with heavy tax. The KMC assessment department also wants to give relief to owners of vacant land by reducing the rates of taxes.

Mayor Sovan Chatterjee on Wednesday said the KMC Act would be amended to give relief to tax payers in different ways. "One of these ways will be to offer tax payers the opportunity to choose between the current GR and upcoming UAA systems," Chatterjee said.

The resolution also wants to vest power in the mayor to waive interests on outstanding property tax. The present civic board has already offered an interest-waiver scheme to defaulters twice in the past two years. However, this time, the civic top brass wants to give absolute power to the mayor under Section 192 of the KMC Act (1980) to waive interests.

Currently, under the KMC Act, the municipal commissioner enjoys the power to waive interests on property tax under Section 192. However, the municipal commissioner is empowered by the section to offer such waiver only to charitable, religious or welfare institutions.

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