Chennai: Residents in rural areas have complained that property tax for houses is being collected at sharply higher rates, alleging calculation errors and arbitrary assessment methods.
Property tax is a key revenue source for corporations, municipalities and town panchayats in Tamil Nadu, where local bodies typically assess tax based on rental value indicators. The state government had issued an order about two years ago to rename “house tax” in rural areas as “property tax”, citing administrative convenience.
While the change was initially seen as only a renaming, collection under the “property tax” head has now begun in villages. Unlike urban areas, residents allege there is no clear assessment framework, and the earlier method of levying tax based on land measures such as cents and ares has been altered.
Social activists said rural house and shop properties were expected to be assessed at a minimum of Re 1 per sq ft, but in several places the rate is reportedly being charged between Re 1 and Rs 5 per sq ft without following any rental-value-based method. They claimed people who earlier paid around Rs 50 as house tax are now being asked to pay between Rs 500 and Rs 5,000, with many seeing increases of over 100%—often learning about it only when they go to pay the tax.
