State’s stamp duty hike to make gifting property costliest in city

Source: The Hitavada      Date: 06 Aug 2017 14:31:18












Special Correspondent,

If you are planning to gift a property to a blood relative, be ready to shell out more money. For, Maharasthra Government has moved a Bill in the State Legislature to hike stamp duty in gift deeds. As per the Bill, the gift deed is set to become the costlier in Nagpur in comparison to other parts of the State including Mumbai and Pune.

The State Government has also proposed to hike stamp duty in peri-urban areas and rural areas. With this, the Government is aiming at generating almost Rs 300 crore in the State for developmental work. It has introduced an Amendment Act called The Maharashtra Stamp (Second Amendment) Act, 2017 in the monsoon session of State Legislature. It may be mentioned that the State Cabinet had decided to hike stamp duty in gift deeds and conveyance in May 2017. Later, the Government withdrew the proposal after stern opposition from citizens. Now, the Government has again approached the State Legislature with the Bill to increase stamp duty.

Under the caption ‘Gift’ in Article 34 of the Schedule-I, stamp duty will be charged according to new rates once the Bill is passed. If the property is gifted from father/mother to son/daughter/grandson, stamp duty will be Rs 200 plus one per cent Local Body Tax (LBT), one per cent Metro Rail Cess, and 0.5 per cent will be Nagpur Improvement Trust (NIT) cess in case of Nagpur. Also, the Government will levy Rs 200 as registration charge. The properties in this case include only residential and agriculture ones. However, compared to other cities including the country’s commercial capital city of Mumbai, gifting of property will be the costliest in Nagpur.

Gifting of property in Pune will cost only Rs 200 plus one per cent LBT; while in Mumbai it will cost only Rs 200. The registration charge of Rs 200 is applicable in Mumbai and Pune too.  If the property is gifted by husband to wife, or brother to sister, or son to father, then 3 per cent stamp duty plus local levies will have to be paid. In Nagpur, they will have to pay 5.5 per cent of the property cost and 1 per cent registration charges. In Pune and Mumbai, they will have to pay lesser than that in Nagpur.

Adv Sandeep Shastri, noted advocate said, the gift deed is costlier in Nagpur as compared to other cities. The Government should offer some relief to citizens. They are paying almost 7.5 per cent stamp duty for conveyance, and gift deed also is costlier. State Government should give relaxation to backward Nagpur in gift deed and conveyance, he said. 

Also, the Government has proposed to levy 5 per cent stamp duty on conveyance of properties in peri-urban areas under Municipal Council and growth centre. Presently, the stamp duty is 4 per cent in these areas. In case of rural areas under Gram Panchayats, the Government has proposed to levy 4 per cent stamp duty on conveyance of properties. Presently, only 3 per cent stamp duty is applicable in these rural areas.

The Bill states that Maharashtra being a welfare State is always ahead in implementation of various development schemes for citizens. To generate resources for implementing various development schemes, projects, and programmes, by way of increasing the revenue of the Government ‘it is considered expedient to hike the stamp duty’, states the Bill.