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Delhi's municipal bodies are moving towards major property tax reforms aimed at bringing clarity, fairness, and ease for taxpayers. The New Delhi Municipal Council (NDMC) has suggested shifting from the old "rateable value" method to a unit area-based system, where tax is linked to property size, age, and condition. Meanwhile, the Municipal Corporation of Delhi (MCD) has recommended limiting retrospective assessments to seven years and ensuring physical surveys before issuing new bills. Both civic bodies are also pushing to replace imprisonment and harsh fines with monetary penalties, reducing legal strain for property owners across the city.
Delhi's property tax structure is set for significant changes as both NDMC and MCD have proposed amendments to their existing systems. NDMC is considering a switch to the unit area-based system, a method already in use in MCD areas, where tax is calculated by looking at the size of the property, its condition, and age. Officials believe this will make assessments more transparent compared to the current "rateable value" method, which many residents, including Connaught Place traders, have often described as unclear and outdated. Advertisement
To make this transition possible, NDMC would need to amend around 50 clauses in its governing act. The civic body is also reviewing over 100 sections covering minor offenses such as non-compliance with sweeper duty or minor building violations. These could be decriminalised by shifting from imprisonment provisions to monetary penalties.
MCD, on the other hand, is focusing on long-pending disputes. At present, many property owners receive tax notices dating back as far as 2004, especially those who did not opt for earlier amnesty schemes. To reduce this burden, MCD has proposed a seven-year cap on retrospective assessments. It has also suggested that a physical site visit be made compulsory before issuing a tax bill for any property for the first time, ensuring better accuracy and fairness in evaluation.
Another proposal from MCD includes penalties for delays in issuing property notices or transfer documents, replacing harsher punishments currently in place. This aligns with the overall objective of reducing legal complexity for residents.
These proposals follow recent steps by MCD to make tax compliance easier. It had introduced the Sumpattikar Niptaan Yojana, an amnesty scheme allowing taxpayers to settle dues without additional fines or interest. The corporation also made user charges optional during tax payment, easing transactions for property owners. These earlier measures, combined with the current reforms, reflect a gradual shift towards a system that prioritises simplicity and fairness.
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