Over 25 lakh property owners in Bengaluru were likely to face a steep hike in property tax in 2023–24, with the Bruhat Bengaluru Mahanagara Palike (BBMP) pushing a proposal to raise rates to boost its revenues. The move was aimed at closing the civic body’s funding gap for infrastructure and services, but sparked concern among homeowners already burdened by rising living costs.​

Background

BBMP has long depended on property tax as its single largest source of own revenue, and has struggled to meet its annual collection targets despite repeated drives and amnesty schemes. For 2023–24, officials pegged the property tax collection target at about ₹4,790 crore, up from a little over ₹4,000 crore in the previous year, forcing the civic body to look at rate revisions rather than just better enforcement.​

Scale of impact

If the proposed hike was cleared, more than 25 lakh property owners across Bengaluru—cutting across apartments, independent houses and commercial establishments—would see higher annual tax bills. The revision was expected to apply across most BBMP zones, effectively affecting taxpayers in both core city areas and newer outer zones brought into the corporation limits.​

Proposed hike structure

Draft discussions within BBMP pointed to a slabbed revision model, with indications of a 25% increase in tax for residential properties and around 30% for non-residential or commercial units compared with prevailing rates. Officials argued that such a hike would still keep Bengaluru’s property tax lower than some other major metros when measured against guidance value and rental yields.​

Rationale from BBMP

Senior Palike officials maintained that the hike was necessary to fund road works, storm-water drain upgrades, solid waste management and other core civic projects that have remained under-financed for years. They also pointed to the widening gap between growing infrastructure demands in newly developed layouts and the stagnant tax base under the older zonal system of assessment.​

Concerns of property owners

Resident groups and apartment federations warned that any across-the-board hike would aggravate the financial stress on middle-class households already coping with higher EMIs, rents, fuel prices and utility tariffs. Landlords cautioned that a sharp increase in outgo could eventually be passed on to tenants through higher rents, particularly in IT corridors and high-demand micro-markets.​

What taxpayers should watch

Property owners were advised to track BBMP council and state government decisions on the proposal, as the final notification would determine the exact percentage hike and categories covered. Experts also recommended reviewing property details and earlier returns to ensure correct classification, since future tax calculations in Bengaluru are increasingly being linked to guidance value and accurate usage type.​

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