Q: Is hyderabad property tax going to be waivered? Im a prospective homebuyer in the city, so i wanted to be well-aware of the situation. So has the govt given its approval for this waiver ?
Generally, the state government reimburses the property tax compensation for government buildings in the Greater Hyderabad area. For this year, the government had made a provision of Rs 40 crore in the budget for this purpose. Another Rs 6 crore is towards certain concessions given to the tax payers
See already the state government releases the grants of Rs 100 crore in instalments, so Im thinking that they may not agree to the additional burden of Rs 340 crore. Also, on the policital front, city TRS leaders feel that the MIM mayor has made the waiver move mainly for political gains in the coming GHMC elections and if the government okays it, the credit may go to the MIM
Also, a proposal like this would mean a further reduction of revenue for the civic body, which is already struggling to pay the salaries for its staff and fund other development works. So yeah, even I think there is not much chance of this waiver happening.
I agree with you guys. Nearly 10 lakh home owners of the total 13.5 lakh in the GHMC area fall under the property tax bracket of Rs 4,000 and the corporation stands to lose about Rs 340 crore every year if it waives the tax. In fact, the corporation generates over Rs 1,000 crore from property tax, which is its main source of income
Waivering the property tax amount is not so simple and easy. The GHMC act would need to be amended at first. As per section 202 A (1) of the Act, the state govt may exempt any residential building occupied by the owner from property tax where the annual rental value is Rs 600. Acc to this, properties having a tax of Rs 156 can be exempted from payment. Similarly, the property tax is very nominal, Rs 4 per year for houses constructed for urban poor.
Ive heard differently. The waiver plan still needs to overcome many hurdles before it can be implemented. The state govt is likely to reject the proposal, because they dont want other municipalities getting encouraged by this and applying for similar tax exemption proposals.
The proposal was moved by the mayor, who belongs to MIM, and Ive heard that MIM and TRS are likely to align and contest the GHMC elections. So I think the TRS government has no option but to give consent to the resolution adopted by the GHMC standing committee
Although this seems like the GHMC will have to suffer heavy losses, they have a plan to bring in the additional 150cr rupees by going after the unauthorized and unassessed properties. The committee has even conducted intensive household surveys a couple of months ago and found out that over five to six lakh properties are still to be assessed for taxes.
Ok so Ive heard that the chairman of the standing committee, said the tax waiver would be applicable to only residential properties for the current year (2014-15) and not on arrears. So he has asked the GHMC commissioner to prepare proposals for the waiver scheme and bring them before the GHMC general council meeting for another resolution, before being sent to the state government for clearance.
If the govt approves this waiver, over 8 lakh property tax payers, of the total 13.5 lakh,wont have to pay tax, and the municipal corporation would lose close to Rs 150 crore revenue per year. They are solely considering this waiver for the election purposes, to score points with the public, since the tenure of this present council ends in the first week of December
I think at this point, the government is likely to issue a GO. On the other hand, the standing committee members said they were hopeful of getting a clearance from the state government as it benefits middle class, lower-middle class and the poor in the Greater Hyderabad region.
NO nothing has been finalised yet. This is just an idea as of now. the GHMC are planning to do this only because of the upcoming corporation elections. If they follow through their plan, then we'll get a waiver of Rs 4000 per year on our property tax amount!