9 months after effecting hike, Punjab to increase collector rates again, asks DCs for proposals

Sources said the government was planning to increase the rates from 5 per cent to 50 per cent again to mend the 50-60 per cent gap between the market rate of property and the collector’s prices.

The market prices are much higher than the collectors’ rates.

Collector’s rates, or circle rates, or guideline values are the minimum prices fixed by the government for property transactions within a specific area.

During the last fiscal, the government had collected Rs 5,900 crore from stamp duty levied on the sale of property.

However, a government officer told The Indian Express that “the government needs to be careful. If collector’s prices become too high, it is observed that people start buying properties on Power of Attorney (POA) and then registering the sale deeds as they have to pay higher stamp duty on the registration. The revenue starts suffering rather than increasing. Also, the property buyers and even sellers prefer a large part of the purchase to be paid in cash rather than white money. We have to factor in all points. It is a well-known fact that India has thrived on a parallel economy, and even the worst of economic recessions did not affect the Indian markets much. Hence, the government should not damage this parallel economy. However, at the same time, property owners sometimes rue when their properties are acquired for government projects, even though they get paid as per the collector’s rates.”

Cheema said that due to differences in collectors’ and market prices of property, corrupt practices thrive.

“We are trying to streamline all this. Soon, there will be a revision. We have effected the revision three-four times in the past. Our government is trying to end corruption, and we are trying to reduce the gap by increasing the collectors’ prices. This can check corruption to an extent,” he said.

As of now, Cheema said, it is not clear how much prices will increase.

“This depends on the DCs’ report. Every district, town and city has different market prices. It depends on that.”

During the last fiscal, the government increased prices to as high as 100 per cent in some parts of the state.

The hike was between 50 per cent and 100 per cent.

Cities like Patiala, Mohali and Zirakpur had 100 per cent increase in the collector’s rates.

After Covid 19, the state saw exponential growth in property buying, with the land prices shooting through the roof.

Properties in Mohali are the most expensive in Punjab.

In cities like Ludhiana, Jalandhar and others, the market prices of properties are too high.