BMP hopes to gain from decision

BMP hopes to gain from decision

The Hindu

Authorities hope the increase in guidance value will help mobilise more revenue

# BMP wrote to Government in March on increasing tax
# Market value of property in Bangalore high

BANGALORE: The State Government's decision to increase the guidance value of property in the city from Friday may be bad news for those who are waiting to get their property registered. But the Bangalore Mahanagara Palike (BMP) authorities hope to gain financially from the move.

The civic body, which has postponed the introduction of its new property tax scheme based on the capital value of a building, is now hoping that the increase in guidance value will help it increase its revenue.

The BMP wrote to the Government in March this year seeking permission to increase the tax rates under the CVS. The officials had reasoned that the civic body's revenue will be affected because of the State Government's modification to the Karnataka Municipalities and Certain Other Law (Amendment), making it mandatory for all municipalities and corporations in the State to fix the rates under the CVS at 50 per cent of the guidance value of a property.

The BMP's argument was that the market value of properties in Bangalore is high compared with other places in the State. "So, there cannot be uniformity in value. We have requested for an amendment to the Karnataka Municipal Corporations (KMC) Act so that the assessable value is proportionate to the market value of property in the city," BMP officials said.

"The amendment to the Act has been welcomed in all other local bodies as it brought down the total tax amount. But if the rates are calculated at 50 per cent of the existing guidance value, it will not be beneficial for us because it will bring down the tax rates and hit our revenue by over Rs. 60 crores. So we had requested for an amendment to the Act," an official said.

While the authorities are aware that a firm political will is essential to allow the BMP to formulate separate tax rates for Bangalore, they now hope that the hike in guidance value will help them mobilise more revenue.

"Now, with the increase in guidance value, there is a possibility of implementing the CVS at the earliest. If the Government does not consider our request, we can still go ahead and introduce CVS because rates at 50 per cent of the new guidance value will help in augmenting our revenue," the official added.