With revenues dwindling due to Covid-19 imposed lockdown, the Andhra Pradesh government is gearing up to jack up property registration fees and property taxes.
The Andhra Pradesh government is contemplating increasing the property registration fees from August 1 to shore up revenues. The revenue department of Jagan government reportedly asked the sub-registars, tehsildars, RDOs to identify the areas where the registration fees could be hiked and accordingly prepare a report.
The Registration Department has been tasked to prepare four reports classifying properties into agriculture, non-agriculture, flats and lands. Sub-registrars, tehsildars, RDOs and other top officials were asked to assess the land values. Based on the suggestions from the officials concerned, the Andhra Pradesh government will make a decision on property registration values.
The lockdown situation has significantly impacted the real estate sector in Andhra Pradesh. The virus outbreak has crippled the overall construction activity and property transactions in the last few months. Demand for housing properties has remained subdued. Further, the lack of jobs and severe scarcity of sand had a ripple effect on the real estate sector. The real estate sector has been under pressure for quite some time now owing to a shortage of sand and other issues.
The construction activity came to a standstill with the artificial scarcity of sand due to widespread sand mafia operations in the state. More than 5,000 housing projects were forced to halt due to the coronavirus imposed lockdown. The growing uncertainty over shifting of capital from Amaravati has further compounded the problem.
The coronavirus lockdown caused an acute liquidity shortage. Revenue collection almost became negligible. The stamps and registration department, which collects a percentage as stamp fee for registration of properties and is one of the top revenue contributors, is struggling to meet targets.
The Andhra Pradesh government has relaxed liquor sale norms as liquor is an important source to shore up revenues.
Experts believe that the move to hike property registration fees would be foolish as it comes at a time revenue sources are drying up and people’s purchasing power declining. Further, the businesses are finding it difficult to maintain the same employment level as the pre-coronavirus period. Further, real estate prices have hit rock bottom due to the pandemic. In such a scenario, the government instead of lowering property registration fees is mulling to hike the charges.
