Monday 18 April 2011

Calculate Your Property Tax Yourself And Save Money

It is that time again when all of us have to pay our property tax to MCC. If you get your tax calculated by the people at the MCC zonal offices or use the Property Tax Calculator of the MCC website (which by the way is still not working, with only 14 days left to get the 5% discount), you are certain to pay much more than what you have to really pay.
According to Sec. 109A of the Karnataka Municipal Corporations Act, 1976, the property tax remains constant for three years and then increases by 15%, then remains constant for three more years and then increases again by 15%, and so on. Once the calculation of property tax is done for any year, it does not have to be done again. Let the value of the site change, let the cost of building change, but you do not have to calculate the tax again. Depreciation is not allowed by the law, and so you do not have to calculate that either. All you have to do is pay the same amount for three years, then increase it by 15% and pay for three more years and so on. Even though the law removes the drudgery of fresh calculation, people still flock to pay Rs. 25-50 to to get their taxes calculated every year. The taxes thus calculated are much higher than what the law demands and so these citizens are suffering a double loss. One of our members who had his tax calculated at the zonal office was told to pay Rs. 3827 when all he had to pay was Rs. 2823.
Here is how you can figure out how much property tax you have to pay this year. This instruction is only for those people who had their tax calculated at a zonal office (or by the Tax Calculator) last year, because we are assuming that people who calculated their own tax last year can do so again this year. We are also assuming that thay have paid the 15% hike in tax last year itself becuase, MCC had issued advertisements in local papers announcing the hike effective from 1-4-10.
Add the total amount paid last year to last year's Solid Waste Management cess. That will be the amount you have to pay this year. The amount to be paid this year is higher because the SWM cess has been doubled this year for properties larger than 1000 sq. ft. The entries in you tax form will be the same, except the SWM cess which is double last year's. If your property is less than 1000 sq. ft., add 3/4 of the SWM cess you paid last year to last year's total amount to obtain the amount you have to pay this year.
By doing this simple addition yourself, you will not only be saving the Rs. 25-50 form filling fee, but you will also save a large amount in the tax paid.
P.M. Bhat, Mysore Grahakara Parishat