Property tax
Topic: Urban Local Government: Municipalities and Cities · NCERT: Beyond NCERT
Meaning
Property tax is a tax on land and buildings. It is the main source of money that urban local bodies raise on their own. Under Art. 243X, the state may allow municipalities to levy such taxes. It can be assessed in three ways: by the rental value of the property, by its area (the unit area method), or by its capital value. More and more cities map properties with GIS, a digital mapping system, to bring every building into the tax net.
Example
The 15th Finance Commission gave ₹1.21 lakh crore to urban local bodies for 2021-26. To get these grants, states had to notify property-tax floor rates, meaning minimum tax rates, and cities had to publish their accounts.
Don't confuse with
- Profession tax: a tax on professions, trades and jobs. Art. 276 caps it at ₹2,500 a year. Property tax is levied on land and buildings.