Karnataka doubles property registration fee to 2%, total transaction cost now 7.6%

The Karnataka government has doubled the property registration fee from 1% to 2%, pushing the total transaction cost to 7.6%. The move aims to bridge revenue shortfalls, but real estate players express concern.

Property registrations in Karnataka are set to become costlier from this weekend, with the State government doubling the registration fee from 1% to 2%, effective August 31. This change raises the overall cost of property transactions to 7.6% of the guidance value, up from 6.6%.

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Currently, buyers pay 5% stamp duty, 0.5% cess, 0.1% surcharge, and a 2% registration fee. Despite the hike, Karnataka continues to remain among the lowest in South India, where property transaction charges in states like Tamil Nadu touch 11%.

The order also doubles the registration fee for Joint Development Agreements (JDAs) and General Power of Attorney (GPAs) for JDAs to 2%. Given that these usually involve large land parcels, the impact is expected to be significant in the real estate sector.

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The government has defended the move by pointing to the sharp revenue shortfall in the Department of Stamps and Registrations. Against a target of ₹26,000 crore in 2024–25, the department collected only ₹22,500 crore. In the first quarter of 2025–26, revenues were 35% lower than the target set at ₹28,000 crore.

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The real estate industry, however, has expressed concerns. Builders argue that bottlenecks like the e-Khata mandate have already slowed property registrations and believe that raising registration fees alone will not address the revenue gap.

Earlier, there was a proposal to raise stamp duty by 1%, but the decision was made to revise registration fees instead, keeping Karnataka among the few states with stamp duty below 6%. Officials said the focus now is to meet the annual revenue target, though no specific additional revenue figures were projected.

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