A robust and effective system of local self-government is foundational to the effective functioning of a democracy. Property Tax is being levied across the Country by Municipalities to augment their resources. J&K was the only State/UT in the country which did not have it. With poor finances, the ULBs across the UT were not able to deliver to their fullest and were dependent on Grants from the Govt. The revenue from other sources of the ULBs accounted for less than 15% of their operational expenses. The funds for development resultantly were not available.

Government of India and the Finance Commissions set up by it, have been strongly recommending tapping this resource from time to time. It is with this background, and with an intend to strengthen out ULBs and ramp up the urban development for the betterment of common masses, the Government has decided to impose property tax in the Union Territory of Jammu and Kashmir.

All residential and non-residential properties situated within the Municipal limits shall be subjected to property tax.

The property tax shall be primarily leviable as follows :––

• (a) If the land or building is let, upon the lessor;
• (b) If the land or building is sub-let, upon the superior lessor;
• (c) If the land or building is let, upon the person in whom the right to let the same vests.

If any land has been let for a term exceeding one year to a tenant and such tenant has built upon the land, the taxes on lands and buildings assessed in respect of that land and the building erect thereon, shall be primarily leviable upon the said tenant, whether the land, building are in the occupation of such tenant or a sub-tenant of such tenant.

Major parameter includes land value, area of property (built-up or vacant), no. of floors including ground Floor and basement, usage of property, construction type, age of property and occupancy (self-occupied or others).

The Property is assessed based upon the Circle rate (Land Value) issued by concerned District Collector of the District in which the ULB falls. Land Value is the circle rates for a block of 3 years as notified under J&K Preparation and Revision of Market Value Guideline Rules, 2011 First block being 1st January 2023.

Property Tax would be calculated on Taxable Annual Value (TAV). Annual Value is not the stamp duty rates but worked out by using formula in which stamp duty rates are one of the factors.

• (a) 5% of TAV on Residential properties.
• (b) 6% of TAV on Non-Residential Properties.

No, The Property tax is calculated for the whole Financial Year and is to be paid Anually.

The person liable to pay the property tax shall pay the tax in two equal installments, the first being before the 30th May and the second by the 30th November of each financial year. However, If the owner or occupier who is liable to pay property tax files return and also pays property tax for the whole year within one month from the date of commencement of the financial year, he shall be allowed a rebate of ten percent on the tax payable by him.

You can pay the property tax through Online Mode and through Bank Challan by using the property tax Portal. You have to file the return along with the Challan latest by 30th May, 2023.If you opt for payment of tax in two installments, you have to pay the 2nd installment by using acknowledgement number of the return filed latest by 30th November, 2023.

Residential houses upto a buildup area of 1000 sqft have been exempted.

Vacant lands, not appurtenant to a structure/building shall be exempt from property tax if there’s a Master Plan in force in the area, under which any construction/development on such vacant land is disallowed or if they have been put to agricultural use as per 6-monthly cropping surveys of the Revenue department.

Similarly, all the properties of Municipalities and all places of worship, including temples, masjids, gurudwaras, churches, ziarats, etc, and cremation and burial grounds shall be exempt from payment of property tax.

All properties owned by Government of India / UT Government shall be exempted from payment of Property Tax. However, service charge at the rate 3% of the taxable annual value shall be payable to the Municipalities in respect of such properties.

The tax collected by the ULBs, will be used for their development needs. This new Property tax policy will help municipal bodies to generate revenue for better municipal services with minimum Tax implications to residents. Better municipal services are expected to attract more investment and encourage more people to set up businesses in the J&K. Revenue generated from property taxes will be used to improve infrastructure, and significantly enhancing the quality and levels of being services provided by Municipal bodies.