Chennai's new interest structure to penalise late property tax payments

If half-yearly tax is not paid on time, civic body will levy 1% SI per month until dues are paid
Image used for representational purpose only. (Express Illustrations)
Image used for representational purpose only. (Express Illustrations)

CHENNAI:  The Greater Chennai Corporation (GCC) has changed its penalty and incentive structure for property tax payments, in line with the Tamil Nadu Urban Local Bodies Rules, 2023.

In case the half-yearly property tax is not paid within 30 days from the commencement of the half-year (April 1-September 30), the civic body will levy an interest of 1% simple interest per month until the dues are paid. Earlier, the civic body had levied an interest of 2% a year. As per the new rules, the interest to be paid as a penalty is to be levied on the first day of every month.

“The idea is that there will now be a disincentive for late payments and an incentive for early payments. Earlier, if property owners missed the deadline, a fixed 2% interest was levied which may result in some losing interest to pay off the dues but here the interest is staggered and so, every month, there is an incentive to pay and avoid further interest being added,” said a senior corporation official.

Similarly, property owners who pay the tax anytime between April 1 to 30 or from October 1 to 30 will be eligible for 5% of the net property tax payable and a maximum of `5,000 as an incentive, as per the new rules. Earlier, the civic body had incentivised payments in the 15 days, from April 1 to 15 and October 1 to 15.

Officials also said that the rules and guidelines of property tax calculation and collection have been laid down clearly, helping them avoid litigation. According to corporation officials, the number of properties paying property tax yearly has increased recently thanks to online payment drives and awareness campaigns. 

Residents may pay property tax dues by swiping credit or debit cards, through e-seva centres in zonal or ward offices, Namma Chennai mobile app, Bharat Bill Payment System, through the website, etc.

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