Power point presentation_of_property_tax_of_kurnool_municipal_corporation

1. 27-7-2011

2. Overview of Structure of
Property Tax in
Kurnool Municipal
Corporation
Presentation by :
Sri.P.V.V.S.Murthy
Commissioner 2
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3. MUNICIPAL TAXATION
1. Kurnool Municipality was upgraded as
Municipal Corporation in the year 1994
2. Taxation is levied in pursuance of Hyderabad
Municipal Corporation Act 1955
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4. SEC 197. TAXATION TO BE
IMPOSED UNDER HMC ACT
1. (1) For purposes of this Act, the Corporation shall impose the
following Taxes namely:-
(a) Taxes on Lands and Buildings.
(b) Octori.
( c) Taxes on Vehicles.
(d) Taxes on Animals and boats.
( e) Taxes on Advertisements other than advertisements
published in the newspapers.
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5. SEC.198. NOTICE REGARDING LEVY
OF TAXES
Before the Corporation passes any resolution
imposing a Tax specified in sub-section(1) of
Section 197 for the first time or at a new rate it
shall direct the Commissioner to publish a notice
in the A.P. Gazette and local newspaper of its
intention to do so.
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6. SEC 199:- PROPERTY TAXES OF WHAT TO
CONSIST AND AT WHAT RATE LEVIABLE
1.Property Tax
(a) General Tax
(b) Water Tax
(c) Drainage Tax
(d) Lighting Tax
(e)Conservancy Tax
2. Taxes shall be levied at such percentages of their
rateable value as may be fixed by the
Corproration. 6
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7. SEC 204:- PRIMARY RESPONSIBILITY FOR
PROPERTY TAXES ON WHOM TO REST.
1. Property Tax shall be leviable primarily form the actual
occupier of the premises upon which the said Taxes are
assessed .
2. Otherwise the said Taxes shall be primarily leviable as
follows :-
(a) if the premises are let from the lessor.
(b) If the premises are sub-let from the superior lessor and
(c) If the premises are unlet from the person in whom the
right to let the same, vest.
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8. VALUATION OF PROPERTY ASESSABLE TO
PROPERTY TAXES
Sec.212:-Rateble Value how to be determined:-
[(1)] (a) The annual rental value of lands and buildings shall be deemed to
be the gross annual rent at which they may be reasonable expected
to be let month to month or year to year with reference to its
location, type of constructions plan of plinth area age of building,
nature of use.
(b) The annual rental value of lands and buildings shall be deemed to be
the gross annual rent at which they may be reasonable expected to
be let month to month or year to year, less a deduction at the rate of
10% of buildings aged upto 25 years and 20% of the buildings aged
above 25 years.
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9. [2] Any vacant land not exceeding three times of
plinth area of the building including site or a vacant
land to the extent of one thousand square meters
which ever is less shall be deemed to the adjacent
premises occupied as an appurtenant to the building
and assessed to tax, to such building the tax shall be
levied thereon at 0.50% of the estimated capital
value of the land.

10. SEC.213:-COMMISSIONER MAY
CALL FOR INFORMATION OR
RETURNS FROM OWNER OR
OCCUPIER OR ENTER INSPECT
ASSESSABLE PREMISES
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11. SEC. 214:-ASSESSMENT BOOK WHAT TO CONTAIN
1. A List of all Buildings and Lands in the city
either by name or number.
2. The rateable value of each such building and
land.
3. The name if ascertained of the person for
payment of property tax.
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12. 4. If any such building or land is not laible to be
assessed to the General Tax the reasons of such
non liability.
5. When the rates of the Property Taxes to be
levied for the year have been duly fixed by the
Corporation.
6. Under Section 227 or 228 a charge is made of
Water supplied to any building or land by
measurement of the Water Tax or Water Charge
fixed at a special rate.
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13. Sec.215:- The Assessment
book to be made separately
for each ward and in parts if
necessary
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14. Sec.218:- Public Notice to be
given when Valuation of
Property in any Ward has been
completed.

15. Sec.219:- Assessment Book to be inspection
Every Person who reasonable claims to
be the owner of some premises entered
in assessment book, he shall be
permitted to inspect and take extract of
the said book.

16. SEC. 220, 221:- TIME OF FILING
COMPLAINTS AGAINST VALUATIONS
TO BE PUBLICLY ANNOUNCED.
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17. Sec.226 :- New Assessment Book need not be
prepared every financial year.
A New Assessment Book shall be
prepared at least once in every five years.
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18. Sec.229 :- Supply of Water at public drinking
fountain etc., not to be taxed.
Sec.232 :- Refund of Property Tax :- any
building or land or any portion of premises
which the Commissioner has treated under
Sec 216 as separate property vacant not less
than ninety days

19. COLLECTION OF PROPERTY
TAXES
Sec.264 :- Property Tax how payable:-
1. Each of the property taxes shall be payble in half
yearly.
2. Half yearly installments, the taxes shall be payable
in advance on each first day of April and October.
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20. Property tax Collection from
2005-06 to 2010-11
2005-06 (97.49%)
2010-11 (97.99)
2006-07 (94.15)
2009-10 (79.58)
2007-08 (98.20)
2008-09 (91.20)
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21. Taxes and Non – Taxes Collection from
Taxes and Non Taxes
2005-06 to 2010-11
2005-06 2006-07 2007-08 2008-09 2009-10 2010-11
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22. Sec.266:- Service of Bills
Every such bill shall specify the period for
which the premises the Tax is Charged
herein after provided against time within
which objection may be raised or on the
decision.
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23. SEC.268 :- NOTICE OF DEMAND
if the amount of Tax for which any bill
has been served as aforesaid is not
paid into the Municipal Office within 15
days from the service thereof, the
Commissioner may cause to be served
upon the person liable for the payment
of the same a notice of demand in the
form of Schedule K or to the like effect.
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24. Sec.269:- Distress:-if the person liable for the
payment of Property Tax does not within 15
days from the service of the notice of
demant, pay the sum due or show sufficient
cause for the non payment of the same to
the satisfaction of the Commissioner, such
sum with all cost of the recovery may be
levied under a warrant in the form of
schedule L or to the like effect to be issued
by the Commissioner by distress and sale of
the goods and chattels of the defaulters.
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25. AREA BASED MODELS OF ASSESSMENT
S.No Feature K.M.C
1 Basis of Levy Annual Rental Value
2 Components •Tax for General Purpose
•Water and Drainage Tax
•Lighting Tax
•Scavanging Tax
3 Basis of Assessment Plinth Area – Zonal ARV rates are fixed
by the ULBs for various categories of
buildings and uses
4 Location Factor/Zoning Zoning is done with reference to expected rental
values in different localities based on
availability of civic services proximity to
markets, educational institutions, etc.
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26. 5 Construction Factor/ Type of -RCC
construction - Madras Terraced
-Mangalore
-Asbestos roofed/GI roofed
-Huts
6 Use Factor Residential, Shops, Shopping complexes, Public
uses offices, Banks, Hospitals, Nursing homes and
Educational institutions, Commercial
Hostel/Lodges/Restaurants and Godowns, Industrial,
Cinema Theatres, Places of entertainment.
Rebates/Deductions
Occupation Factor Owner occupied – residential buildings -
40% inclusive of rebate under age of
building .
Tenant occupied – residential buildings –
10% inclusive of rebate under age of
building
Owner / Tenant occupied – Non-
Residential buildings – 10% inclusive of
rebate under age of building. 26

27. Rebates/Deductions
Occupation Factor Owner occupied – residential
buildings -40% inclusive of
rebate under age of building .
Tenant occupied – residential
buildings – 10% inclusive of
rebate under age of building
Owner / Tenant occupied –
Non-Residential buildings –
10% inclusive of rebate under
age of building.
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28. Module for calculation of Property Tax of a
Residential Building.
Plinth area of the Building :- 10.mts X10.mts =100 sq.mts.
Roof of Building :- R.C.C.
Nature of usage :- Residential Owner
Rate fixed for one sq.mt.:- Rs.11.50
Monthly Rental Value of the Bldg :- 100 sq.mts X 11.50 =1150.00 M.R.V.
M.R.V.= (2/3 Building Value) X ( 1/3 Site Value).
Annual Building Value :- (1150X 2/ 3)X12 = 9199.99 or 9200
Annual Site Value :- (1150 X 1/3) X12 = 4599 or 4600
Annual Building Value :- 9200 X 40% =3680 (Less depreciation for owner occupation)
9200-3680 = 5520 (net ARV after depreciation)
Annual Rental Value :- ABV + ASV =ARV (5520 + 4600 = 10120 )
Property Tax fixed :- ARV X 12.50% = (10120 x 12.50% =Rs. 1265/- per half year.
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29. MODULE FOR CALCULATION OF PROPERTY TAX OF A
RESIDENTIAL BUILDING.
Plinth area of the Building :- 10.mts X10.mts =100 sq.mts.
Roof of Building :- R.C.C.
Nature of usage :- Residential Tenant.
Rate fixed for one sq.mt.:- Rs.11.50
Monthly Rental Value of the Bldg :- 100 sq.mts X 11.50 =1150.00
M.R.V.
M.R.V.= (2/3 Building Value) X ( 1/3 Site Value).
Annual Building Value :- (1150X 2/ 3)X12 = 9199.99 or 9200
Annual Site Value :- (1150 X 1/3) X12 = 4599.99 or 4600
Annual Building Value :- 9200 X 10% =920 (Less depreciation for
owner occupation)
9200-920 = 8280 (net ARV after depreciation)
Annual Rental Value :- ABV + ASV =ARV (8280 +4600 =12880 )
Property Tax fixed :- ARV X 12.50% = (12880 x 12.50% =Rs.
1610/- per half year.
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30. MODULE FOR CALCULATION OF PROPERTY TAX OF A NON- RESIDENTIAL
BUILDING.
Plinth area of the Building :- 10.mts X10.mts =100 sq.mts.
Roof of Building :- R.C.C.
Nature of usage :- Non-Residential (Shop) (Owner / Tenant).
Rate fixed for one sq.mt.:- Rs.68.00
Monthly Rental Value of the Bldg :- 100 sq.mts X 68.00 =6800
M.R.V.
M.R.V.= (2/3 Building Value) X ( 1/3 Site Value).
Annual Building Value :- (6800X 2/ 3)X12 =54396
Annual Site Value :- (6800 X 1/3) X12 = 27199.99 or 27200
Annual Building Value :- 54396 X 10% = 5439 (Less depreciation
for owner occupation)
54396-5439 = 48957 (net ARV after depreciation)
Annual Rental Value :- ABV + ASV =ARV (48957+ 27200 =51657 )
Property Tax fixed :- ARV X 16.50% = (51657 x 16.50%
=Rs.8523/- per half year.
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31. Finances of Municipalities
Main sources of Income :
Taxes :
i. Property Tax
ii. Advertisement Tax
iii. Government have taken over levy and
collection of Profession Tax from 1987-
88 and paying compensation to the
ULBs
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32. PROPERTY TAX AND WATER CHARGES ONLINE
COLLECTION COUNTERS IN THE OFFICE PREMISES

33. Tax Payers paying Tax at Office Collection Counter

34. STAFF COLLECTING TAX FROM THE TAX PAYERS

35. COMPUTERIZED DEMAND NOTICES OF PROPERTY TAX
AND WATER CHARGES ARE ISSUED FOR TAX PAYERS.
TAX PAYERS ARE FACILITATED FOR PAYMENT OF
PROPERTY TAX AND WATER CHARGES ONLY THROUGH
ONLINE COUNTERS LIKE COLLECTION COUNTER IN OFFICE
PREMISES AND THROUGH E-SEVA CENTERS.
DUE TO ONLINE COLLECTION MIS-APPROPRIATION AND
MALPRACTICES ARE AVOIDED.
THERE IS ALSO GOOD RESPONSE FROM THE PUBLIC
FOR PAYING OF TAXES

36. Non-Taxes
i. Water Charges
ii. Fee from Markets and Slaughter
Houses
iii. Rents from Commercial Complexes
iv. Building Licence Fee
v. Trade Licence Fee
vi. Betterment and development charges
vii. Encroachment Fee
viii. Contributions towards water supply
connections
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37. Water Charges 1. Kurnool Municipal Corporation is having
33635 domestic Tap connections and
collecting @ Rs.600/-for each half year for
each assessment.
2. Kurnool Municipal Corporation is having
707 Nos. of metered Tap connections given
for the Commercial buildings. And the
charges are claimed as per unit rates.
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38. Fees from Markets and Kurnool Municipal Corporation will conduct
Slaughter Houses open auction for each financial year. The details
are given below. It is got income of Rs.8.58
lakhs for the financial year 2011-12 which is
collected in advance at the time of finalization of
open auction.
1.Markets :- 3 Nos.
2.Slaughter Houses :- 4 Nos.
3.Cycle Stands and other properties:- 4 Nos.
Rents from Commercial Kurnool Municipal Corporation is having 21
Complexes complexes with 401 shops. The shops are leased
out in open auction. Reservation is given to S.C.,
S.T. & Disable.
Kurnool Municipal Corporation is getting
income Rs.132.84 lakhs per annum.
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39. Assigned Revenues
i. Entertainment Tax : 90% of Entertainment
Tax collected by Commercial Tax
Department is assigned to ULBs on
quarterly basis.
ii. Surcharge on stamp duty : Surcharge on
Stamp Duty is levied @ 2% of the value of
the instrument by Registration Department
and 100% of the Surcharge on Stamp Duty
is allocated to ULBs on quarterly basis
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40. THANK YOU
overview of municipal authorities in ap
dt[1]. 19-7-2011
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