Advertisement
When should a housing society in Mumbai start considering re...
From GST on JDAs to SEBI’s REIT reclassification and the S...
Stay ahead in the world of real estate with our daily podcas...
Stay ahead in the world of real estate with our daily podcas...
The New Delhi Municipal Council is working on a property tax reform that may reduce tax liability by 30% to 50%, especially for older and self-occupied properties. The proposed shift to the Unit Area Method aims to bring uniformity, reduce disputes, and simplify calculations. The plan also includes lowering the maximum tax rate and enabling self-assessment. While traders have welcomed the relief, they have raised concerns about implementation. The civic body expects better compliance to support revenue despite lower rates.
The New Delhi Municipal Council (NDMC) is preparing to introduce a revised property tax system that could reduce the tax burden for a large number of property owners in central Delhi. The proposal focuses on shifting from the existing annual rental value-based system to the Unit Area Method (UAM), which is expected to bring down property taxes by around 30% to 50% in many cases. The benefit is likely to be more visible for older buildings and self-occupied properties. Advertisement
The proposed reform is part of amendments being considered under the Jan Vishwas Bill, which aims to simplify rules and improve ease of compliance. The new system will calculate tax based on the size, location, and usage of a property instead of its estimated rental income. This change is expected to remove inconsistencies where similar properties in the same area were taxed differently due to varying rental assumptions.
NDMC officials explained during discussions with traders that the revised method will include an age-based factor, allowing older properties to attract lower taxes. They also indicated that different portions within a property, such as commercial shops, offices, or storage spaces, will be assessed separately. This is expected to make the calculation more accurate and fair for mixed-use properties, which are common in areas like Connaught Place.
The civic body is also planning to reduce the maximum property tax rate from 30% to 20%. This reduction is expected to directly lower the overall liability for taxpayers. In addition, the system will introduce self-assessment and online payment options, making the process simpler and reducing dependency on manual intervention. These steps are aimed at improving transparency and reducing disputes that were common under the earlier system.
During stakeholder interactions, traders highlighted issues in the current framework where non-payment by one occupant could lead to action against the entire property. They suggested that enforcement should be limited to defaulters only. Officials responded by stating that the new system is being designed to address such concerns and that further consultations will continue before finalising the framework.
NDMC's property tax collection stood at around INR 1,045 crore in the last financial year. With the new system in place, the council expects collections to improve to about INR 1,350 crore, mainly due to better compliance and a wider tax base rather than higher rates. This indicates that the civic body is relying on simplification and transparency to improve revenue.
Alongside tax reforms, NDMC has also taken steps to support infrastructure improvements. It has allowed a temporary waiver on road restoration charges for PNG pipeline work carried out by Indraprastha Gas Limited. This move is aimed at encouraging cleaner energy adoption while reducing cost pressures on utility providers.
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
