Thiruvananthapuram: The new finance bill prepared by Finance Minister K N Balagopal has proposed sweeping changes in the assessment of property (building) tax rates. It include provisions to revise the tax rates by 5 percent every year and double the fine for defaulting its payment to 2 percent.
The bill, which is slated to be presented in the state assembly next week, also includes the provisions to charge a fuel cess of Rs 2 as well as the liquor cess, as announced in the budget last month. The minister has already clarified that the provision to impose an additional tax on vacant houses will not be implemented and hence the same is not included in the new bill.
The existing provision to double the stamp duty for the resale of property within just three months of its earlier transaction has been excluded from the bill. The provision to charge a stamp duty of 150 percent in case of the resale between the third and sixth month too has been avoided.
Instead, the stamp duty of all such transactions has been fixed at a flat eight percent for such transactions, as in the case of regular property deals.
Last week, the State Government issued a notification for raising the stamp paper rate for handing over flats and apartments within six months of its construction to seven percent from five percent.
As per the new bill, the building tax will be reassessed every five years. The hike of five percent, meanwhile, will be effected on the rate fixed in the previous year. If the building has a roof, the roof may be included or excluded from the tax after due inspections. The bill also points to the provision for assessing the building tax based on the floor area or the fair value of its land. These provisions also enable the Government to bring changes in the assessment of building tax rates in the future.
All government and aided educational institutions, besides the playing areas and libraries to which the public has free access, have been exempted from paying the tax. Meanwhile, the exception granted to recognized educational institutions other than government, aided establishments, and their hostel buildings has been removed.
At present, the families in the BPL category, which live in houses having a floor area of less than 30 square feet, need not pay the building tax. The new bill proposes to extend the scope of this exemption to families of any category, which live in houses that have a floor area of 60 square feet or below. The new changes will come into effect from April 1 onwards.