Mangalore authority slashes betterment fees by 80% – what is it about?

In recent announcements from Mangalore Urban Development Authority (MUDA), the betterment fee for real estate was revoked for layout, single-site, and five-time land change, after request acceptance from the government. This revised fee was approved by the state Chief Minister, BS Yediyurappa and the Urban Development ministry headed by BA Basavaraja.

But what is it all about?

What are betterment fees?

Betterment fees are the charges collected by civil authorities if the price of a property has risen due to infrastructural development of the area, including the construction of a metro, commercial complex, or industrial corridor. Its calculation is typically done on the basis of per cent of market value per square meter of the property. Betterment fees are charged one-time but you may have to pay it while renovating or adding construction to your home.

Betterment fees are an addition to the stamp duty. It is seen as a special charge that is levied when an infrastructural development takes place in any locality, boosting the overall property prices.

Betterment fees levied
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MUDA Chairperson Ravishankar Mijar cited an example while addressing the media persons. He added that if the betterment fees for 5 cents land worth ₹6 lakhs per cent was previously ₹33,000; the fee would be ₹6,800 as per the revised charges. He further added that the Konaje layout will shortly be completed and the site allocation process will follow soon after. 

Where are these funds used?

Betterment fees are generally used for the development of public infrastructure, aiming at resource immobilisation. Since the aim of collecting these charges is future infrastructural development, Mangalore authorities have already devised a plan for it.

MUDA is also developing Master Plan – III as a part of the AMRUT scheme using GIS technology. Announcing the developments, the MUDA chairperson said that the base plan is ready and 75% of the land survey has been completed. Stakeholders and local representatives will be consulted before finalising the plan. He further added that MUDA is also scouting for land near Mangalore Special Economic Zone (SEZ) to develop a truck terminal, which it plans to build over relevant National Highways. The Commissioner of MUDA was also present during the press conference.

Can it affect real estate prices?

While it is still unclear if it can affect property prices, the tax levied on the properties will certainly be reduced extensively. Better fees are special charges levied on properties for price appreciation due to the infrastructural development of the area. Since the development works are in progress under the Mangalore authority MUDA, one can only predict.

Besides Mast Plan – III, MUDA is also developing Urwa Market and restoring lakes under Green Mangalore Initiative. Slashing 80% betterment fees, however, will surely provide relief to the local real estate owners.

Disclaimer: The views expressed above are for informational purposes only based on industry reports and related news stories. PropertyPistol does not guarantee the accuracy, completeness, or reliability of the information and shall not be held responsible for any action taken based on the published information.


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