Any one who owes a property (usually real estate) is liable to pay Property tax to the Municipal Corporation. It is an ad valorem tax, which means the amount of tax is estimated on the value of the property being taxed. Property Tax in India is levied on residents by local municipal authorities to upkeep the basic civic services in the city.
There are four types of property - land, improvements to land (immovable man-made objects, such as buildings), personal property (movable man-made objects), and intangible property. The percentage of property tax ranges from 5% to 20%.
Real property (also called real estate or realty) means the combination of land and improvements. Under a property tax system, the government requires and/or performs an appraisal of the monetary value of each property, and tax is assessed in proportion to that value. Forms of property tax used vary among countries and jurisdictions.
The property tax rate is often given as a percentage. It may also be expressed as a per mil (amount of tax per thousand currency units of property value), which is also known as a millage rate or mill is also one-thousandth of a currency unit.).
To calculate the property tax, the authority will multiply the assessed value of the property by the mill rate and then divide by 1,000. At times, various states and Municipal corporations tend to waive off the interest rate on property tax in certain situations.