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CAF's Position on Capital Value System

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CAF (Citizen's Action Forum)'s position on CVS being presented at the meeting with RWA's convened by the Cabinet Sub-Committee on Tuesday, the 15th July, '08 (9AM to 1.30PM) at the Ravindra Kalakshetra, J C Road, Bengaluru.

  1. CVS is unconstitutional. Only the Central Govt is authorized to tax capital value of assets of individual and companies.
  2. CVS is unfair, as it taxes those who have no control over the appreciation of the property value and they would be forced to leave their homes, being unable to pay the tax, if it is based on CVS.
  3. Present CVS law would bring back "inspector raj", since self-assessment, even if based on CVS is not accepted, but has to be approved by the Revenue Officer.
  4. Major part of property taxes would normally be from commercial and industrial properties.
  5. BBMP is violating the law [Sec 112 B of the KMC Act, by NOT carrying out surveys of ALL properties and NOT maintaining the Property Register.
  6. A crisis / panic situation is sought to be created by vested interests, bent upon CVS, by refusing to collect as per earlier method, to force the new Govt to go in for CVS.
  7. Once the MPC is constituted, BDA & BMRDA become irrelevant and redundant. They should be wound up and the monies lying in their accounts transferred. This would generate over Rs. 3000/- Crores.
  8. Property taxes should be based on the civic services consumed, by the owners / users of the property. Simple formulae based on differential slab rates of quantum of services consumed could be worked out, to determine Property tax rates.
  9. Properties owned & occupied by senior citizens, widows, retired persons with no other source of income, should be exempted from Property tax.
  10. Stringent penalties, including penal provisions, as for income tax evasion, should be made for Property tax evasion, together with onus on property owners for filing tax returns and making payment.
  11. In view of all above, CVS should be scrapped all over the State and replaced with a rational, equitable, better administered property tax system.

Comments

tsubba's picture

CVS

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114 users have liked.
they are right.
2) CVS is unfair, as it taxes those who have no control over the appreciation of the property value and they would be forced to leave their homes, being unable to pay the tax, if it is based on CVS. 8) Property taxes should be based on the civic services consumed, by the owners / users of the property. Simple formulae based on differential slab rates of quantum of services consumed could be worked out, to determine Property tax rates.
from what i understand, i agree. thats like a tax on potential value. realization of value should be taxed.
9) Properties owned & occupied by senior citizens, widows, retired persons with no other source of income, should be exempted from Property tax.
i dunno hows this is doable without suddenly a lot of people start registrating their homes in their parents and ajja ajjis names.
4) Major part of property taxes would normally be from commercial and industrial properties.
agree.

Tax residents as well

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Why not follow the 'Patna Model of Taxation'?

More about that:

http://www.hinduonnet.com/lf/2002/07/09/stories/2002070901310200.htm

It throughs up a lot when it is searched on google.

It is important to note that low tax rates and a wide tax net increases the tax collection. Ideally if this is done, then stamp duty rates could go down and make real estate transactions more white than black.

Please note that revenue through stamps and registration is an important source for the Government of Karnataka and we should be less dependent on this.

silkboard's picture

Prepared for Sakrama too?

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First of all, I love these citizen feedback meetings which are "by invitation only", and are organized bang in the middle of a work week. Clearly, these are for the unemployed and the retired. Or may be, BBMP thinks bunking work to attend these is a test of seriousness.

anyway, since you are going Murali sir, remember to express our views on Sakrama too. The ads in paper about this 'interactive session' mention they will talk and hear Sakrama as well. 

 

Gautamrao's picture

I wouldn't agree with this one

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"9) Properties owned & occupied by senior citizens, widows, retired persons with no other source of income, should be exempted from Property tax."

 

This is the only point with which I disagree. There are many retired people who have high incomes on account of their previous position or career. There are many widows who are earning well. What happens when they get remarried? Tarle Subba has made a very good point here. We guys can transfer all our assets in the name of our aged parents or widowed women family members like sisters/ daughters/ mothers etc. An example of retired people with high income would be retired IAS/ IPS officers, Army Officers, Judges, Corporate honchos [Narayana Murthy of INFOSYS is a senior citizen], Executives, Doctors, etc. Some of these people have higher income than even middle-level service people.

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