New Policy Targets Unearned Profits from Leased Land Sales

The state cabinet has authorized a new policy for recouping unearned profits from the sale and conversion of leased land. A huge number of similar properties may be found throughout Mumbai, its suburbs, and other regions of the state, most notably Nagpur and Amravati. According to a government announcement, the amount of unearned income that can be recovered depends on the use of the land and if authorization was acquired prior to sale or change of use. Because the land is leased, the government assesses unearned income in the form of a percentage of the difference between the current market value or the price realized through sale, whichever is greater, and the occupancy price at which the land was originally granted, plus any structural and permanent improvements that create assets and influence land valuation. Unearned income will be 50% with permission and 60% without permission for agriculture to agriculture, 60% with permission and 75% without permission for agriculture to non-agriculture, and 50% with permission and 60% without permission for change of use from non-agriculture to previous use. The unearned revenue charged for permission to shift to non-agricultural use will be 60% with permission and 75% without permission. See also: Cabinet approves policy on longterm leasing of Railways landCabinet approves reduction in railway land licence fee to 1.5%