JOIN USSkewed property tax collection methods hurt MCC
Several drawbacks of Mysore City Corporation (MCC) has affected property tax collection in its limits, denting revenues of the civic body and worsening its financial woes.
One of the problems highlighted by activist Bhamy Shenoy is the absence of working property tax calculator. Though a property tax calculator is available in the MCC website, the amount displayed by the calculator differs from the assessment made using tax forms. One of the reasons for the difference between the calculator and the tax form is that the software computes tax based on actual built up land and computes tax multiple times for each floor present in a plot. Tax form, along with the property, computes tax differently, thereby affecting the revenue of MCC, he said.
Understatement
Highlighting another drawback, he said that while laws since 2004 do not take depreciation factor into consideration, MCC insists on using depreciation. “This has resulted in understatement of taxes,” he said. As per Karnataka Municipal Corporations Act, taxes should be increased by 15 per cent every three years.
However, MCC has ignored the law and is expecting citizens to pay tax at older rates by only taking into consideration the new depreciation rates. This has increased revenue losses to the civic body, he said.
Noting several other issues in the system, he said that property tax laws must be reformed at the State level in order to streamline the collection process. A state of the art software and appropriate training to MCC staff can help plug these anomalies, so that revenue generation of the civic body can be increased, he added.
Shenoy added that there was a potential to collect Rs 120 crore as property taxes, provided existing laws are implemented strictly and bureaucrats shed their indifference regarding the issue.
When contacted, B L Bhyrappa, Chairman of Standing Committee on Tax, Finance and Appeals confirmed that there were errors in the MCC property tax calculator. “This is because 15 per cent depreciation is not taken into account by the software. However, the errors will be rectified and the software will be updated in the next two months,” he said.
He added that though MCC had identified 1.7 lakh properties in its limits, information on vacant plots was not available, as property owners had not made khatas. “People who have owned properties for more than three decades too have not made khatas. We have taken measures to collect taxes for these properties with penalties, when these people come forward,” he said.
He said that ward-wise information of the number of properties has been sought, which will be available within a short period, enabling effective collection of property taxes.