The state government is toying with the idea of hiking rates for registration of apartments and land from 2017-18.

The registration department recently held a meeting to discuss the issue, close on the heels of Bihar falling short of its revenue target in 2016-17. It collected only Rs 2,900 crore against a target of Rs 3,800 crore. The last time the minimum value rate (MVR) of land was increased was in January 2016 but rural areas were left out.

MVR is the base rate for fixing stamp duty of a property in a particular location. Simply put, words, it is the official price of a plot or an apartment flat fixed by the government on which stamp duty is charged. Rise in MVR leads to hike in registration fee one pays to get a property registered in his/her name. Till 2013, MVR was revised on a yearly basis but through an amendment in the Bihar Stamp (Prevention of under Valuation of Instruments) Rules, 1995, the annual practice was withdrawn for urban and semi-urban areas.

"In the meeting held last week, attended by officials from all nine divisions of the state, reports were sought from all 38 districts regarding the actual price and the market price of land," an official of the registration department said on condition of anonymity on Saturday.

He said concerns were raised at the meet regarding a shortfall of Rs 900 crore in revenue collection in 2016-17, which has prompted the government to raise MVR rates to cut the existing gap. A review meeting will be called to deliberate on the issue, he said and added: "In several commercial areas, government rates are less than market rates owing to which the state is suffering revenue losses."

The department has also asked for reports from officials of the registration department across the state regarding upcoming colonies on the outskirts of cities like Patna and also land in industrial areas, where sales have risen drastically in the past few years, the official said. Once, the review meeting concludes, the department will also get the sites inspected.

The property registration fee in Patna was hiked in February 2016. It was construed as a move to make up for the revenue loss of about Rs 4,000 crore arising out of the liquor ban since April 1, 2016. While the MVR of commercial land and flats had gone up by 25 per cent, residential land and flats saw 10 per cent hike in registration cost.

Before 2016, another round of hike in MVR was made in May 2013. However, the hike in MVR rates was reduced later owing to protests. The state government had reduced the rates through another revision effected in October 2014.

Demonetisation was one of the factors behind the state not meeting the revenue target in 2016-17, as registration of properties was hit hard in Bihar after November 8, 2016.

Land registration figures show a nosedive of nearly 32 per cent from November 8 to November 24, according to the records of registry offices.

According to state government data, there were 22,178 land registrations in the state from October 25 to November 8, but it dwindled to 15,118 between November 9 and November 24.

However, with the situation improving in view of cash flow and demand again heading northwards for new properties - land and apartments - particularly on the city's outskirts, the government is contemplating to increase the MVR rates.