Property Tax

Common Questions on Property Tax Laws

1. What is Property Tax?
2. Which Law Governs Property Tax?
3. What happens if I don’t pay property tax?
4. Where to appeal if the tax is abnormal?

What is Property Tax?

Property tax is a tax charged by the municipal experts for the upkeep of fundamental common civilities like streets, sewer framework, parks lighting, and so on. Property tax is generally exacted based on sensible rent at which the property may be, in the event that specific property isn't leased, the renting rate is estimated by the predominant rates in that locality.

Immovable property is inclusive of the improvements made on land along-with the land itself. Property tax is primarily tax on lands and buildings, however, it should not be confused with the tax paid on the basis of income from a property. Some of the kinds of property that can be charged for property tax are-

• Office Building
• Factory Building
• Flats
• Shops
• Godowns, etc.

As per Article 285 of the Constitution, properties belonging to the Union Government are exempt from payment of property taxes. The three major methods of calculation of property tax are the Annual Rental Value (ARV) or Rate-able Value, the Capital Value System (CVS), the Unit Area System (UAS).

Which Law Governs Property Tax?

Property tax are mainly governed by Municipal Corporation laws as framed by Local Municipal Authorities. These are mainly state laws but it obviously does have been made keeping in mind all other central enforced laws so that it doesn’t go beyond the scope Human Ambit or Harsh.

What Happens if I don’t pay Property Tax?

The taxing authority could sell your home to satisfy the debt. (It might do this through a foreclosure process.) The taxing authority may sell the tax lien that it holds, and the purchaser may be able to foreclose.

Where to appeal if the tax is abnormal?

A process for appeal against the property tax assessments exists. All municipal acts have made a provision for appeal against the assessment mostly to a Committee or a specified authority. The next level of appeal is the District Judge, who is the final fact finding authority. There are differences amongst States in the constitution of appeal committees/authorities and subsequent appeals before the Civil Courts. In the case of Property Tax, the assessor determines the access able value of the property. The appeal process gives taxpayers the opportunity to challenge the assessable value, on the grounds of reasonableness, if they so wish.