<p>Bengaluru: Property transactions across Karnataka are likely to become costlier from April 1, as the state government is taking steps to revise the guidance value of land and buildings.</p><p>The average increase in the guidance value is likely to be anywhere between 15 per cent and 20 per cent, sources said, though a final decision is yet to be taken.</p><p>The move will directly impact stamp duty and registration charges. The revision, which seeks to account for the increase in market rates, comes at a time when the government is staring at a revenue shortfall from property registrations.</p>.Bengaluru owners seek relief on Rs 70L property tax arrears .<p>Sources in the government told <em>DH</em> that the Department of Stamps and Registration has been asked to roll out the revised guidance value on April 1. It has also directed the department to complete the formalities and publish the draft guidance value at the earliest.</p><p>A senior government official said the rules allow for a revision of the guidance value every year, given that property prices continue to rise. However, the last revision was effected in October 2023, the official said.</p><p>It is learnt that the Central Valuation Committee, which is authorised to fix the guidance value, met on January 12, setting in motion the revision process.</p><p>Officials involved in the exercise said the proposed hike is needed to reduce the gap between market rate and government prices, adding that the revision is nothing to do with the revenue shortfall.</p><p>“We had initially set a target of earning Rs 28,000 crore, but it was reduced to Rs 25,000 crore, given the issues in registering properties after e-khata was made mandatory. Now, we are short of revenue by Rs 3,000 crore, and the shortfall will be covered in the next month,” the officer said, adding many people tend to register property by the end of the financial year to minimise capital gains tax.</p><p>An upward revision in guidance value would increase the minimum transaction value for property registrations.</p><p>Currently, the government charges 5 per cent of the guidance value as stamp duty, 2 per cent as registration fee, and 0.60 per cent as cess and surcharge. In total, property buyers pay 7.60 per cent in duties and cess.</p><p>Suresh Hari, former secretary of CREDAI, said the increase in guidance value was acceptable, but it should not be used as a yardstick for calculating stamp duty. “If it is kept as the yardstick, registration costs would go up.”</p>
<p>Bengaluru: Property transactions across Karnataka are likely to become costlier from April 1, as the state government is taking steps to revise the guidance value of land and buildings.</p><p>The average increase in the guidance value is likely to be anywhere between 15 per cent and 20 per cent, sources said, though a final decision is yet to be taken.</p><p>The move will directly impact stamp duty and registration charges. The revision, which seeks to account for the increase in market rates, comes at a time when the government is staring at a revenue shortfall from property registrations.</p>.Bengaluru owners seek relief on Rs 70L property tax arrears .<p>Sources in the government told <em>DH</em> that the Department of Stamps and Registration has been asked to roll out the revised guidance value on April 1. It has also directed the department to complete the formalities and publish the draft guidance value at the earliest.</p><p>A senior government official said the rules allow for a revision of the guidance value every year, given that property prices continue to rise. However, the last revision was effected in October 2023, the official said.</p><p>It is learnt that the Central Valuation Committee, which is authorised to fix the guidance value, met on January 12, setting in motion the revision process.</p><p>Officials involved in the exercise said the proposed hike is needed to reduce the gap between market rate and government prices, adding that the revision is nothing to do with the revenue shortfall.</p><p>“We had initially set a target of earning Rs 28,000 crore, but it was reduced to Rs 25,000 crore, given the issues in registering properties after e-khata was made mandatory. Now, we are short of revenue by Rs 3,000 crore, and the shortfall will be covered in the next month,” the officer said, adding many people tend to register property by the end of the financial year to minimise capital gains tax.</p><p>An upward revision in guidance value would increase the minimum transaction value for property registrations.</p><p>Currently, the government charges 5 per cent of the guidance value as stamp duty, 2 per cent as registration fee, and 0.60 per cent as cess and surcharge. In total, property buyers pay 7.60 per cent in duties and cess.</p><p>Suresh Hari, former secretary of CREDAI, said the increase in guidance value was acceptable, but it should not be used as a yardstick for calculating stamp duty. “If it is kept as the yardstick, registration costs would go up.”</p>