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The Karnataka government has announced a betterment tax and a 1% stamp duty cess on properties near the Bengaluru Business Corridor (BBC) to recover project costs and repay a USD 3.27 billion loan from HUDCO. The betterment tax will apply to properties within 500 meters of the tolled road, while the stamp duty cess will cover transactions within 1 km of the corridor. Additional revenue measures include transit-oriented development on select land parcels. These steps aim to fund infrastructure, interest, and other costs while enhancing the corridor's commercial viability.
The Karnataka government has moved to impose a betterment tax and a 1% stamp duty cess on properties located near the Bengaluru Business Corridor (BBC). These measures are intended to recover costs related to the 117 km tolled road project and assist the Bangalore Development Authority (BDA) in repaying a USD 3.27 billion (INR 27,000 crore) loan from HUDCO, which carries a 9% interest rate. Advertisement
According to the urban development department's proposal, the betterment tax will apply to lands up to 500 meters from the road edge, as the initial 500 meters are expected to see a greater increase in land value. Meanwhile, the 1% stamp duty cess will be levied on property transactions within 1 km on either side of the corridor. Funds collected through this cess will be remitted to a dedicated BBC bank account.
The BDA is also exploring transit-oriented development (ToD) as a revenue source, where land parcels of 50-100 acres near key junctions along the corridor will be used for planned commercial and residential development, along with rest areas. These measures, combined with toll collection expected to generate INR 7,000 crore, are designed to cover infrastructure costs, interest, and other ancillary expenses.
For the first phase, covering 73 km from Tumakuru Road to Electronics City, total land acquisition is projected to reach 2,600 acres. BBC chairman LK Atheeq confirmed that multiple compensation options will be available for farmers to ensure smooth land acquisition, aiming to complete the process within four months and subsequently invite tenders for road construction.
While property owners and developers have expressed concerns about additional costs, authorities have emphasized that these initiatives are crucial to fund infrastructure improvements, support the corridor's development, and enhance Bengaluru's overall business environment.
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