Property Tax
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Definition
The state list in the VII schedule of the Indian Constitution provides for the levy of property tax. The tax is designated as “Taxes on lands and buildings”. In the Government of India Act of 1935 the parallel entry was “Taxes on lands, buildings, berths and windows”. Property tax is by far the main stay of Municipal finance in the State. This tax possesses the essential characteristics of a good tax.
Property Tax India
Property tax is a tax that an owner of property (usually real estate) is liable to pay. The amount of tax is estimated on the value of the property being taxed (advalorem tax). Property Tax India is levied on residents by local municipal authorities to upkeep the basic civic services in the city. Property, again consists of three entities:
- Land
- Improvements to Land (immovable man made things)
- Personalty (movable man made things)
Features of Property Tax India
In India, the actual owners of property are liable to pay municipal taxes which is in contrast to that in the United Kingdom, where the tenant is liable to do so. Generally, the property tax is levied on the basis of reasonable rent at which the the tax payer can claim his ownership rights over the property. Property tax in India is paid on a year to year basis. The 'reasonable rent' can be 'actual rent' if it is found to be fair and reasonable. In the case of non-rented properties, the rental value is to be estimated on the basis of local tax rates. The monetary valuation of property is done by the concerned authorities who often do not function directly under the municipality in order to exercise unbiased estimation. There is a common misconception through which people relate property tax to assessment tax while they are two different forms of taxation. Property Tax relies upon the fair market value of the property being taxed for justification. Assessment Tax relies upon a special enhancement called a 'benefit' for its justification. The property tax rate is often given as a percentage but may also be expressed as a 'permille' (amount of tax per thousand currency units of property value), which is also known as a 'millage rate' or 'mill levy'.
Properties liable to Tax
All buildings and lands unless exempted under the statutes are liable to property tax.
See also
- Taxation in India
- Income tax in India
- Permanent account number for Income tax in India
- Income tax in India for Individuals
- Income tax in India for Partnership Firms
- Income tax in India for Corporates
- Income tax in India for Hindu Undivided Families _ HUFs
- TDS Tax Deducted at Source Indian Income Tax
- Advance Income tax in India
- Guide to filing tax returns
- Consumption tax
- Central Excise (India)
- Fringe Benefits Tax (India)
- Gift Tax in India
- Sales Tax
- Entertainment Tax
- Property Tax
- Education Cess
- Service Tax
- Value Added Tax in India
- Wealth tax in India
- Income tax in India
