The CPI(M) has opposed the proposal of the State government to fix property tax on the basis of property value in Andhra Pradesh and not on the basis of rental value as is being done now.
In a statement here on Thursday, CPI(M) City Committee secretary B. Ganga Rao alleged that the YSRCP government has accepted the conditions of the Centre in this regard. The Centre was planning reforms in property tax collection to bring a uniform tax structure in municipalities and corporations across the country.
“The objective of the government is to hike property tax exorbitantly every year. The property tax is being fixed, so far, based on the rental value and the size of the property. But now, the plan is to calculate the tax based on each square foot for individual houses, flats and commercial properties. The rental value would be fixed at 2% to 4% of the cost,” Mr. Ganga Rao said.
Citing an example, Mr. Ganga Rao said that if a person owns a house on a 100-square yard site, and if the square yard cost is ₹25,000, the land cost would be ₹25 lakh. And if a house is constructed on the land at a cost of ₹10 lakh, the total value of the property would be ₹35 lakh. If house tax is fixed at 2%, the tax for six months would be ₹7,000.
The property tax would be linked to the market value and would be hiked every year. As of now, the property tax is being revised after every five to seven years. He said that this would be abolished. There are 4.5 lakh assessments in the GVMC limits. The new tax system would result in an additional burden of ₹700 crore as house tax in Visakhapatnam city.
Subsequently, water tax and garbage tax would also be hiked, he alleged and demanded immediate withdrawal of the change in the method of property tax fixation.
