BBMP fixes loophole; zonal classification for property tax to be auto-populated

Neither property owners nor department officials will be allowed to select the zone

Over a year after the row over “wrong zonal classification” while paying property tax leading to tax notices to thousands of property owners, the city’s civic body has now fixed the loophole in its property tax portal. The zonal classification for every property will henceforth be auto-populated in the portal. Bruhat Bengaluru Mahanagara Palike (BBMP) has finally fixed the loophole in its property tax portal, one that caused much consternation among property owners. More than a year ago, thousands of property owners received notices even though they had paid their dues on account of ‘wrong zonal classification’. 

The zonal classification for every property will henceforth be auto-populated in the portal. Neither property owners nor department officials will be allowed to select the zone, which was the source of the confusion. Those properties that have been declared in the wrong zone will also be moved to the correct zone. 

Property taxes in each of the six zones in the city — from A to F — vary significantly. The zones, first classified in 2002, were updated and reclassified in 2016-17. However, several property owners had not updated the zones in the portal while paying taxes, leading to underestimation of money owed and loss of revenue to the civic body. 

In 2021, BBMP served notices to 78,500 property owners in the city claiming they had under-estimated tax and asked them to pay arrears, interest and penalty. BBMP hoped to raise ₹360 crore in arrears, including ₹200 penalty. 

Owners protested arguing that the civic body had not updated the zonal classification in its portal and those who were served notices had not underpaid deliberately or tried to cheat the authorities. While the BBMP has written to the State government seeking a waiver of penalty, it has insisted on collecting arrears. The State government is yet to take a call on the issue.

Sources in the civic body said there had been a strong lobby to keep the zonal classification open on the portal, which was a source of corruption. “Many revenue officials used this loophole to under-estimate tax for properties, including commercial properties to save owners tax and caused revenue loss to the civic body, for illegal gratification. By locking the zonal classification on the portal and not allowing access to change it even to department officials, this avenue of revenue loss and corruption has also been plugged,” a senior official said. This reform is expected to help the civic body shore up property tax collection in the city.