The Karnataka Government on February 17, 2021 has issued the Karnataka Municipalities (Second Amendment) Act, 2021 to further amend the Karnataka Municipalities Act, 1964.
The following amendments have been made:
• Section 101 (2)(b), which specifies the description and class of property tax, has been substituted, namely:
“residential building and buildings other than commercial at such percentage not being less than 0.2 percent (rupees two per thousand) and not more than 1.5% of taxable capital value of the building.”
• Section 101 (2)(c), which specifies the description and class of property tax, has been substituted, namely:
“vacant land measuring not above one thousand square meters, at not less than 0.2 per cent) [not more than 0.5 percent (rupees five per thousand)] of taxable capital value of land.”
• Section 101 (3), the second proviso, which specifies the description of class and property tax, has been substituted, namely:
“Provided further that, the vacant land appurtenant to the building, up to one thousand square feet shall be exempted and more than one thousand square feet shall be levied with property tax on vacant land in accordance with clause (c) of sub-section (2).”
• Section 102 (1), which specifies the method of assessment of property tax, has been substituted, namely:
“The taxable capital value of the building shall be assessed 1 [together with the land occupied by it]. The taxable capital value of such land shall be assessed having regard to the 2 [market value guidelines of properties published]2 of the land notified by the Government under section 45B of the Karnataka Stamp Act, 1957 subject to such rules as may be prescribed, the taxable capital value of the building shall be 3 [equivalent of twenty five percent of] the market value guidelines of properties published under section 45B of the Karnataka Stamp Act, 1957 minus depreciation at the time of assessment as may be notified by the Government from time to time].”
• Section 102A, which specifies the enhancement of the property tax, has been substituted, namely:
“Notwithstanding anything contained in section 101 and 102 the property tax assessed and levied under either provision shall be assessed in year of revision of guidance value of property under section 45B of the Karnataka Stamps Act, 1957.
The property tax shall stand enhanced by three percent for every financial year in which no revision of guidance value is made. Provided that, the Municipal Council may enhance such property tax up to five percent for every financial year and different rate of enhancement may be made to different areas and different classes of buildings and lands.
Provided further that, nothing contained in this section shall be deemed to affect the power of the State Government to direct an earlier revision of property tax.”
• The Karnataka Municipalities (Amendment) Ordinance, 2021 (Karnataka Ordinance 02 of 2021) is hereby repealed.
[Act No 03 of 2021]
