Guideline Value refers to the minimum value set by the government for a property or land, used primarily for calculating stamp duty and registration charges during property transactions. It represents the governmentís benchmark estimate of the propertyís worth in a specific area, also known as the circle rate, ready reckoner rate, or jantri value (depending on the state).

In simple terms, guideline value is the price below which a property cannot be officially registered. If a buyer declares a purchase value lower than the guideline rate, the stamp duty will still be calculated on the guideline value, not the declared price, to prevent tax evasion and ensure transparency in real estate transactions.

Formula for Stamp Duty Calculation:

Stamp Duty = (Higher of Market Value or Guideline Value) ? Applicable Stamp Duty Rate

Key Points about Guideline Value:

• Set by State Governments: Each stateís registration department periodically revises guideline values based on market conditions and infrastructure development.
• Varies by Location: Rates differ across cities, localities, and even streets, depending on amenities and demand.
• Affects Taxation: Used to determine capital gains and prevent property undervaluation in official records.
• Available Online: Most state governments provide online portals where property buyers can check the latest guideline values.

Example:
If the market value of a flat is ?60 lakh and the guideline value is ?55 lakh, the stamp duty will be calculated on ?60 lakh. However, if the declared value is ?50 lakh, the authority will still use ?55 lakh (the guideline value) for tax computation.

In conclusion, the guideline value acts as a regulatory tool to maintain fairness and transparency in the real estate market, ensure adequate revenue collection for the government, and curb under-reporting of property values.