MCD plans to rope in pvt players to increase properties under tax net

Hindustan Times

5 days ago

The Municipal Corporation of Delhi (MCD) is set to engage private operators to help identify properties that remain outside the tax net in a bid to augment its property tax revenue, officials familiar with the civic body's plan said on Tuesday. Property tax is one of the key revenue sources for the cash-strapped civic body, but low levels of compliance have remained a challenge. (HT Archive)
A senior MCD official said that a request for proposal (RFP) has been nearly finalised and will be floated in the coming weeks to select agencies that demand the lowest share of revenue. The official added said such a model has been tested by civic agencies in Odisha and Jodhpur and is being adapted to Delhi's context.
Under the proposed model, private firms will survey the city to locate untaxed properties. Once identified, the civic body will share a portion of the tax collected from these units with the operator. 'The RFP is almost ready. The idea is to boost revenue collection while ensuring compliance. The private agencies will be tasked with identifying the properties, but any tax notice will only be issued by MCD's accessor and collector department,' the official said.
Property tax is one of the key revenue sources for the cash-strapped civic body, but low levels of compliance have remained a challenge. This year, MCD collected approximately ₹2,163 crore from around 1.3 million taxpayers, a small fraction of the city's estimated 4 million properties. For the financial year 2025–26, MCD has set an ambitious target of ₹4,000 crore in property tax collection.
'The role of the private operator will be limited to conducting surveys and bringing property data to the respective zonal offices. Notices and assessments will remain strictly under the control of MCD to prevent any misuse or harassment,' the official added.
Another official clarified that while MCD is entitled to recover pending dues dating back to 2004 from such non-compliant units, the private agency's profit share will apply only to the current financial year. 'Many properties in unauthorised colonies have never paid tax. Even in planned areas, we've found gaps in the payment history. These agencies will help plug those loopholes,' the official said.
As per the Delhi Municipal Corporation Act, all properties—whether in planned colonies, regularised or unauthorised settlements, urban villages, or even vacant plots—are liable to pay property tax. The survey will thus cover both planned and unplanned areas.
While MCD has not issued an official statement on the matter, officials confirmed the civic body's decision to intensify its efforts in bringing untaxed properties into the fold.
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Separately, on August 1, MCD extended the deadline for taxpayers to avail the 10% rebate on property tax for the financial year 2025–26 till August 31, 2025. It also announced the launch of 'SUNIYO – Property Tax Settlement Scheme 2025–26' (Sampattikar Niptaan Yojana), under which property owners can get a full waiver on dues preceding 2020–21, including interest and penalties. To qualify, property owners must pay the principal amount for the current fiscal year and for the previous five years (2020–21 to 2024–25) without any interest or penalties.