Property tax to be imposed in municipal areas in Jammu & Kashmir from April 2023

Last week, the administration of Jammu and Kashmir announced that property tax will be imposed on municipal areas in the Union Territory beginning April 1. The notification stated that residential properties will be taxed at five percent of taxable annual value (TAV), while commercial properties will be taxed at six percent. The notification was issued by Housing and Urban Development Department Principal Secretary H Rajesh Prasad, who stated that the power to levy, assess, and collect property tax in the municipalities and municipal councils of the Union Territory is conferred by section 71A of the Jammu and Kashmir Municipal Act 2000.

The National Conference criticized the decision and demanded its immediate rollback, saying that it is arbitrary and will push the people of Jammu and Kashmir further towards economic hardship. According to NC spokesperson Imran Nabi Dar, the people of Jammu and Kashmir have already been suffering since 2019 due to the restrictions imposed following the abrogation of Article 370 and subsequent COVID-19 lockdowns. He added that such decisions should be left to an elected government and that the current bureaucratic setup does not allow for public scrutiny of such important issues. Dar called the decision anti-people and a grave injustice.

In October 2020, the Ministry of Home Affairs (MHA) had empowered the Jammu and Kashmir administration to impose property tax through an amendment to the J&K Municipal Act, 2000 and J&K Municipal Corporation Act, 2000, as per the J&K Reorganisation (Adaption of State Laws) order, 2020. The amendments stated that property tax will be levied on all lands and buildings, as well as vacant lands within municipal limits.

Previously, most political parties, traders, and civil society groups in Jammu and Kashmir had opposed the imposition of property tax. In response to criticism, the administration had dropped the plan to impose the tax. However, the rules for the Jammu and Kashmir Property Tax Act 2000 were recently notified to facilitate the imposition of property tax across municipal areas in the Union Territory.

The proposal for the property tax was approved by the Administrative Council, which directed that the proposed tax, set to take effect on April 1, 2023, be levied at half of the proposed formula. According to the rules of the notification, any person liable to property tax must furnish particulars of their property and tax due to the officer authorized to receive them by May 30 of the financial year. The second instalment of the tax should be furnished by November 30, along with proof of receipt of the first instalment. Failure to pay the tax will result in a penalty of Rs 100 or one percent, and the maximum penalty will not exceed Rs 1,000. The Act also includes provisions for inspection, assessment, and reassessment, and an appeal process to the director of local bodies until the board in this direction is set up.

Next (Unitech projects get SC push as Noida Authority told not to insist on dues)

Property tax to be imposed in municipal areas in Jammu & Kashmir from April 2023

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