Upto 45% increase in tax amount

A comparison of SAS to UAV methods of property tax calculation shows instances of increase of nearly 45% in the new tax amount.

The property tax collection by BBMP for the year 2008- 2009 has been in the confused state.It started from changing to CVS from SAS,than to UAV and latest being UAV with old SAS rate.

Now, if one calculate there is not much change in the revised tax if the building is used for residential purposes comes under the same zone, but there are instances of increase of nearly 45% if there is a jump to next higher zone (E to D) – please refer to the chart below for an example.

We from the Citizen Action Forum and Jayanagar 5th Block Residents Welfare Association request the government to notify that irrespective of calculation, the maximum increased tax to be paid by a citizen who resides in his/her own building should amount to a maximum of 20%. This will help nearly 10 lakh pensioners of Bangalore.

Comparision of Property taxes under the SAS and UAV systems
Area of Building 1000 Sft
Age of Building as on date 12 Years

Case 1: When the property remains in the same zone
Sl No Particulars Incidence of tax under
    SAS UAV
    Rate Amount Rate Amount
1 When the property remains in the same zone, say E zone 2.4 2400 2.4 2400
2 Less Depreciation 20 480 12 288
3 Tax   1920   2112
4 %age difference       10.00

Comparision of Property taxes under the SAS and UAV systems
Area of Building 1000 Sft
Age of Building as on date 12 Years

Case 2: When the property is upgraded by 1 zone
Sl No Particulars Rate Amount Rate Amount
1 From F to E 2 2000 2.4 2400
  Less Depreciation 20 400 12 288
  Tax   1600   2112
  %age difference       32.00
2 From E to D 2.4 2400 3.2 3200
  Less Depreciation 20 480 12 324
  Tax   1920   2816
  %age difference       46.67
3 From D to C 3.2 3200 3.6 3600
  Less Depreciation 20 640 12 432
  Tax   2560   3168
  %age difference       23.75
4 From C to B 3.6 3600 4 4000
  Less Depreciation 20 720 12 480
  Tax   2880   3520
  %age difference       22.22
5 From B to A 4 4000 5 5000
  Less Depreciation 20 800 12 600
  Tax   3200   4400
  %age difference       37.50

Comments:

  1. Malolan R Cadambi says:

    It is a good thing that property taxes are going up in Bengaluru. We have the lowest per capita taxes but one of the highest per capita incomes. If we want world class infrastructure, then we better be prepared to pay world class taxes as well.

  2. D R Prakash says:

    I am sorry to repel from the view of our friend MR.MALOLAN R.CADAMBI, as no owner is against paying an increased property tax, but does not want to pay an EXORBITANT tax. Another point to be borne in mind about the increase in per capita income is only amongst the younger generation who hold a marginal share of the properties in Bangalore proper city (Old BMP area) and most of the owners are retired / aged persons whose income is not at par with the present PCI, Hence protesting against an ABNORMAL INCREASE in tax is JUSTIFIED. With this I request all the property owners to join together to protest a genuine cause.

  3. Malolan R Cadambi says:

    Mr D R Prakash’s point is well noted. I did blog sometime back that newer areas housing the newer generation need to be taxed more. This is also justified because newer areas need infrastructure more than older areas which Mr Prakash mentions. The new tax package proposes to tax vacant land more, which is a welcome measure.

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