The Hindu : Andhra Pradesh News : Uniform tax system for merged areas

Online edition of India's National Newspaper
Thursday, Aug 30, 2007
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Andhra Pradesh

Andhra Pradesh

Uniform tax system for merged areas

G.V.Prasada Sarma

It covers 16 villages in Gajuwaka , 9 and 7 in Pendurthy and Madhurawada zones

VISAKHPATNAM: The procedure adapted for rationalisation of process in the 32 gram panchayats merged in the municipal corporation follows a scientific process according to a GO of the Municipal Administration Department. After the merger, it was observed that the panchayats have different rental values, different percentages (of tax rates) and the tax was not levied on the plinth area.

Hence it has been decided to introduce a tax system uniform with the Municipal Corporation and based on plinth area. For the purpose, the areas in the respective panchayats have been divided into three categories - posh, semi-posh and ordinary. The structures have been categorized into residential (permanent and temporary) and commercial. The commercial category has several reclassifications depending upon their use. Rates of rent per square foot have been decided after a survey. They range from 50 paise to 10 paise for residential and Rs. 3.50 to 50 paise for non-residential purposes.

Processing

The monthly rental value is calculated by multiplying the plinth area with rent based on which gross annual rental value (GARV) is arrived at. The GARV is apportioned as two-thirds of the gross value for building annual rental value (BARV) and one-thirds is site ARV (SRV). For residential buildings, a 40 per cent discount is given on BARV (not on SRV) and for Visakhapatnam, a five per cent additional discount is applicable to all assessments as it is a city on seashore. The NARV of the building is BARV Net i.e., after 45 per cent discount) plus the SRV. The annual tax is calculated on the net annual rental value at the rate of 25.88 per cent for residential assessments and 30 per cent for non-residential ones. The 25.88 percent includes general tax of 10 percent, water and drainage cess 8 percent; lighting cess 2 percent; conservancy cess 3 percent and library cess 2.22 percent. Exemptions are given on the property tax depending upon the building’s age and usage. The property tax may be assessed by individuals by accessing the website gvmc.gov.in and the link ‘online services.’

The process has been decided upon after press advertisements and a gazette notification in 2006. In Gajuwaka municipality, no revision has been effected as the process was implemented in 2003. The new property tax rates came into force from the second half of 2006-2007. It covers 16 villages in Gajuwaka zone and nine and seven in Pendurthy and Madhurawada zones respectively falling in 21 wards.

On complaints of high taxation, Deputy Commissioner (Revenue) Y. Sai Srikant says a revision petition may be filed within 15 days of receiving the demand notice.

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