Correct Answer - Option 3 : 10% to 12%
Concept
In India municipal corporations or urban local bodies (ULB’s) levy two types of taxes
i) Property tax ii) Professional tax
Property tax is an annual amount paid by a land owner to the municipal corporation of his/her area.
The municipal corporation assesses and imposes the property tax annually or semiannually. The amount is generally based on construction, area, property size etc. It also compromises lighting tax, water tax and drainage tax.
Property tax is the most important tax levied by ULB’s in India; most cities are greatly dependent on property tax revenue for their budget.
Different states and cities have different rates of taxes and performance level. Such as in collection of property taxes, Bangalore is taken as benchmark.
However, in general, the percentage of property tax ranges from 5% to 20%
∴ Option (3) can be chosen as 10 – 12 % are within 5 – 20 %
