The Bengal governor has given his assent to a bill that will allow the Kolkata Municipal Corporation (KMC) to raise the property tax payable by an owner by up to five per cent every year if the owner does not sign up for the unit area assessment system, civic sources said.
Following governor C.V. Ananda Bose’s assent, the state municipal affairs department published the bill in The Kolkata Gazette, Extraordinary, which means the legislation has come into effect.
“The amendment (to the Kolkata Municipal Corporation Act, 1980) is effective from June 9,” said a senior KMC official. The amendment reads: “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 per cent.”
It will be adjusted once the owner shifts to the unit area assessment system. “Any extra payments will be adjusted once the person has signed up for the unit area system,” said a KMC official.
The unit area assessment system — a newer method of calculating property tax — was introduced in the Kolkata municipal area in 2017. Since then the civic body has issued multiple appeals to residents to shift to the newer mode of tax calculation.
The KMC has over 9 lakh taxpayers, about 35 per cent of whom have signed up for the unit area assessment, said civic officials. The rest are continuing with the older system, in which the tax is calculated based on the annual valuation of a property.
The unit area assessment system empowers property owners to calculate their tax, which depends on a number of factors such as the location and age of the property, and the width of the road in front of it. As part of the newer system of tax calculation, the city has been split into 293 blocks. Properties located in blocks with better infrastructure invite higher taxes, officials said.
To sign up for the new system, a property owner has to fill in a form.
The Assembly had last year passed an amendment to the KMC Act 1980 seeking to raise the tax payable by a property owner by up to 5 per cent if the owner does not shift to the new system.
The governor before giving his assent to the bill sought explanations on certain provisions in it. The secretary of the state’s municipal affairs and urban development department met him to answer the queries, said KMC officials.
“The nod came soon thereafter,” a civic official said.
“We can now raise property tax by up to five per cent every year if the owner does not sign up for the unit area assessment, which was introduced in 2017. The act will not have any retrospective effect,” a KMC official said.
Most tax bills of the fiscal 2023-24 have been dispatched. Officials said the amendment will be invoked when bills for the 2024-25 fiscal are dispatched next year.
Penal provision
A KMC official said the amendment also empowered the civic body to impose a penalty on a taxpayer for willful suppression of facts or entry of wrong information while filling in the self-assessment form.
The penalty will be 30 per cent of the difference between the actual property tax and the tax that has been calculated based on wrong or incomplete information.