property must be registered for transfer or for any other type of transaction. The state government assigns a percentage to the market or transaction value that must be charged as stamp duty. The percentage varies for rural and urban areas, and even within urban areas it may vary for corporations, councils, and nagar panchayats. In some cases, stamp duties are also assigned based on the size of the property. In a few states, such as Andhra Pradesh, Goa, and Telangana, stamp duty is charged at a fixed rate that increases along with the property’s transaction or market value. In most states, the registration fee is typically charged at 1 percent of the transaction value. In a few cases it is also charged as a fixed value.

States may also levy an additional surcharge along with stamp duties and registration fees. This surcharge is typically an ad valorem rate decided by the state and may vary from region to region within the state. For instance, an additional charge of 1 percent is levied in Pune as a “local bill collection charge,” along with the standard stamp duty and registration charge.

# Legal provisions for levying recurrent property tax on immovable property

The Indian Constitution under Article 243X, authorizes state governments to devolve the power to levy and collect taxes, duties, fees, and tolls to ULBs. State governments lay down the limits for the rates of these taxes, charges, and fees and the procedure for levying them. The functions to be devolved to the ULBs are laid out in a separate schedule, but no ULB tax list is mentioned in the Constitution of India. Thus, the devolution of the power to levy and collect taxes is done at the discretion of the individual state governments.

Recurrent property taxes in India are typically levied by ULBs in keeping with the procedures laid down by the states in their individual Municipal Acts. The procedures laid down in these acts cover tax bases, tax rate structures, policies for rebates and exemptions, and measures for dealing with defaults and delays in payment. ULBs’ autonomy to value property taxes is strictly limited. Their primary responsibility is for designing the collection mechanisms and fixing tax rates within a limited range defined by the state. The provisions provided in the states’ Municipal Acts are further enacted by the ULBs through rules and regulations published as gazetted orders.

This section provides an overview comparing the legal framework for levying property taxes as established in the Municipal Acts of all 28 states and the Delhi Municipal Corporation Act, 1957 (as amended up till 2011). These acts and their latest amendments were sourced from the official websites of the state governments. In addition, property tax frameworks of 20 of the largest cities in India have been analyzed against the provisions of the property tax rules and regulations published by the individual municipal corporations. These rules and regulations were sourced from the official websites of the municipal corporations.

As per the Municipal Acts, the majority of states have devolved the power to levy and collect property taxes to their respective ULBs. In practice, however, most ULBs collect property tax at the discretion of the state. For most ULBs, the state or the property tax boards or valuation committees constituted by the state are the final authority on decisions regarding maintenance of property records, methods of tax 36