The Bruhat Bengaluru Mahanagara Palike (BBMP), Bengaluru civic body has considered to waive off the penalty and extra interest on tax demand that was going to be charged from the property holders who earlier failed to pay taxes as per the zonal reclassification.
The action was taken after the Palike received criticism for giving notices to around 78,000 property holders on charges of paying tax amount less than what they were supposed to pay for the assessment years of 2016-17 to 2019-20. Stating that the owners chose wrong zone to pay tax, the civic body imposed a penalty of 24% interest per annum along with double the difference amount.
“The taxpayers had no clue about the zonal reclassification and thus a misunderstanding prevailed due to the communication gap. To provide a solution, the BBMP officials have decided to recourse and waive off the penalty,” said Mr. Rakesh Singh, administrator of BBMP.
The Self-Assessment Scheme, which was introduced in 2000, classifies properties under eight value zones. The category of the zones is based on the guidance value of the locality and accordingly the rate of the property tax is fixed. The zones attract values according to their characteristics. Zone A is considered to be of the highest value while the zone F falls in the lowest slab.
If a property holder chooses a wrong zone, then she/he is liable to pay double the difference amount along with a 2% interest rate.
As per the rules, the property zones should be reclassified once in three years by BBMP. The civic body reclassified the zones in 2008-09 and in 2016-17 as well. What went wrong this time, is that they didn’t inform the taxpayers about the reclassification.
Now, Gaurav Gupta, who is the chief commissioner of BBMP, will be looking into the matter and the complaints received from taxpayers, to introduce a better resolution.