In a significant move to formalize property ownership and increase government revenue, Karnataka is set to introduce taxation on unauthorised properties. The state government plans to finalize guidelines for this unauthorised property taxation initiative by mid-July, marking a key step in regulating informal property holdings.
This initiative aims to bring millions of unauthorised properties, particularly in rural areas, under the tax net. By issuing temporary property documents known as B-Khatas for unauthorised properties, local bodies such as gram panchayats will be empowered to levy property taxes. This process will integrate previously unregistered properties into the formal economy, improving transparency and accountability.
So far, Karnataka has issued e-Khatas to over 50 lakh properties. The inclusion of unauthorised properties in the taxation framework is expected to significantly boost state revenue. The Rural Development and Panchayat Raj department alone has collected over ₹1,273 crore in the current fiscal year, with revenues anticipated to rise as more properties become taxable.
This move aligns with similar efforts in urban areas where unauthorised properties have been regularized and taxed through B-Khata issuance. The government views this as a critical step to regularize property ownership and improve the delivery of public services and infrastructure.
Officials have also highlighted the state’s commitment to decentralization and rural development, pointing to ongoing initiatives like digital libraries, creches, and the Jal Jeevan Mission for safe drinking water.
Property owners with unauthorised holdings are encouraged to stay updated on the forthcoming guidelines to ensure compliance and take advantage of the formalization process.
