Hike in market value aided revenue growth

Despite a four per cent reduction in stamp duty collected for the registration of properties, the Stamps and Registration Department is expected to increase its revenues by Rs 700 crore over the previous year.
If the real estate boom in the city’s outskirts partially contributed to the realisation of the current financial year’s revenue target of Rs 2,500 crore, it is the increase of market value of lands across the State that played a vital role in the 40 per cent growth in revenue.
The government’s move, however, made a mockery of the reforms in stamp duty on which the Centre and realtors have been insisting. After years of persuasion, the State government finally reduced the stamp duty from 13 per cent, which was highest in the country, to nine per cent this year and retained the 0.5 per cent registration fee. But the actual benefit of reducing stamp duty was not felt by people, thanks to the increase in market values.
The revenue of the department stood at Rs 1,900 crore in January and officials were confident of reaching the target before the end of the financial year. In Hyderabad, the department collected Rs 280 crore against Rs 239 crore for the corresponding period in the previous year. In Ranga Reddy, where the real estate boom is at its peak, officials achieved this year’s target of Rs 450 crore by end of January.
With the idea of increasing market value even further, the government directed the department to fix a target between Rs 3,000 crore and Rs 3,200 crore. “With the real estate boom dwindling, there is no option for the department except to increase the market values,” said a senior S&R department official.
Though the department decided to bring the government market value to 70 per cent of the open market value, it could not implement it in several places, including the outskirts because of the huge difference between the two values. “For instance, in several places in Ranga Reddy district, the government value is Rs 1,500 per sq. yd while the open market value is more than Rs 10,000. We cannot go from Rs 1,500 to Rs 7,000 in one stroke. We have to increase the value gradually,” one sub-registrar in the district pointed out.
Official sources said the department identified Banjara Hills, Jubilee Hills, Hitec city, Nanakramguda, Gopanapalli, Vattinagulapalli, Kondapur, Medchal, Shamshabad, Maheswaram, Bibinagar, Pattancheru, Rajendra Nagar and Serilingampally, among other places, to heavily increase market values. Similarly, the department has proposals to increase the market value of agricultural lands in coastal districts.