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Study in Campo Grande Points to IPTU with Property Value up to 14 Times Higher than Reality. City Hall Promises Review of Tax Base in 2025.
A survey conducted in Campo Grande (MS) revealed significant distortions in how municipal taxes on properties are calculated. The study, released in February 2025, identified cases where the IPTU (Urban Property and Land Tax) and the ITBI (Tax on Transfer of Real Estate) were charged based on property values up to 14 times higher than the market price of comparable properties in similar regions of the city.
The report raised alarms not only among taxpayers but also within the municipal administration, which announced an urgent review of the Generic Value Plant (PGV) — a document that serves as the basis for calculating these taxes. Change in the Purchase and Sale of Properties: New Law Provides for Calculation Based on Market Value and Can Double the ITBI in Brazilian Capitals, Reaching over R$ 30 Thousand in Some Cases
How the IPTU and ITBI Calculation Basis Works
The IPTU is calculated based on the property value defined by the PGV, which considers criteria such as location, land size, built area, and finishing standards. The problem is that, in many municipalities, this table does not keep up with the reality of the real estate market, leading to charges above the fair amount.
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The ITBI, charged when there is a purchase and sale of properties, also uses the property value as a reference, which may differ from the real transaction price. This opens the door for legal disputes between taxpayers and the city hall, especially when there are significant discrepancies.
What the Study Found in Campo Grande
According to the report, in neighborhoods of Campo Grande, the property value applied by the city hall for calculating the IPTU and ITBI was up to 14 times higher than the average value practiced in the real estate market for similar properties.
One of the analyzed examples showed that while the real sale price of a property was around R$ 120 Thousand, the property value used for charging the ITBI was over R$ 1.6 Million.
Cases like this prompted strong reactions from real estate sector entities and organized civil society.
The City Hall’s Response
In light of the repercussions, the City Hall of Campo Grande acknowledged the need for corrections and announced that the Generic Value Plant will undergo a technical review in 2025. The objective is to align the criteria of the calculation base with market reality, ensuring greater transparency and tax fairness.
According to technicians from the Municipal Finance Department, the revision should include:
- Updating the real estate appraisal methodology;
- Adopting comparative criteria that are closer to the real market;
- Involvement of class entities and representatives from the construction sector in the review process.
Impacts for Taxpayers
The revision of the PGV may have a direct impact on taxpayers’ wallets. For those who were paying amounts well above the market, the expectation is a reduction in IPTU and ITBI. On the other hand, properties that were undervalued in the table may face adjustments.
Tax law experts point out that correcting the calculation base is necessary to reduce the risk of litigation. In recent years, hundreds of taxpayers have filed lawsuits contesting the amounts charged by the city hall, resulting in administrative and financial strain for the municipality.
Comparison with Other Cities
The situation in Campo Grande is not isolated. Various Brazilian municipalities face similar challenges, with deflation or overvaluation of the Generic Value Plant. In São Paulo, for example, the 2014 PGV review generated strong public reaction and was one of the main topics of debate on municipal taxation at the time.
In many cases, updating the PGV is avoided for political reasons, as it can lead to IPTU increases in certain regions. However, when distortion reaches levels like those identified in Campo Grande, correction becomes unavoidable to preserve the credibility of the tax system.
What Experts Say
According to economist and urban policy researcher André Maia, interviewed by the local press, “when the calculation base strays so far from reality, the tax system loses legitimacy. The taxpayer feels unjustly punished, and the municipality loses revenue due to increased noncompliance.”
Meanwhile, tax attorney Carla Torres emphasizes that “aligning the PGV with the market value is essential to provide legal security for both taxpayers and the city hall itself.”
The Next Step
The city hall of Campo Grande promised to complete the PGV review still in 2025, based on technical studies and participation from civil society. The expectation is that the new parameters will be applied to the calculation of IPTU for 2026.
Until then, taxpayers will continue to pay based on the current table, but societal pressure and legal actions should accelerate the process.
The case of Campo Grande highlights how flaws in defining the IPTU and ITBI calculation base can lead to serious distortions, compromising tax justice and trust in the system. The PGV review is seen as an urgent and necessary measure to align the property value with market reality, ensuring a balance between municipal revenue and the contributing capacity of the population.
Isto deve está acontecendo em todos município, por que estes vereadores que só servem a interesse, dos mais afortunados em vez de se preocupar com interesse da população mais humilde, estão lá para investigar a prefeitura para o povo, chegam lá só querem foder o povo e dar incentivo ao ricos
Os ricos tbém pagam a mais. Para com essa idéia de que rico é malvadão.
É um absurdo o IPTU nessa cidade.