Delhi: MCD presents ₹17,000-crore budget for 2025-26

This is the third consecutive year that the budget has been presented directly in the House instead of the Standing Committee

The Municipal Corporation of Delhi (MCD) commissioner Ashwini Kumar on Thursday tabled budget proposals worth ₹17,006 crore for 2025-26, keeping property tax rates unchanged for the financial year 2025-26 despite what he described as a “serious financial crisis”.

Delhi Mayor Mahesh Khichi addresses the gathering during the special Budget meeting at Civic Centre in New Delhi on Thursday. (Sanjeev Verma/HT Photo)

While property tax collections till January 31 have improved, surpassing last year’s figures by ₹215 crore as of January 31, the total remains well below the projected ₹4,300 crore for the current financial year.

While delivering the budget, Kumar warned that MCD is grappling with a very “serious financial crisis” with liabilities of ₹14,000 crore, including pending payments to contractors, employee salaries, retirement benefits, and loan repayments.

He stressed the need for increased revenue, spending cuts, and greater financial support from the Delhi government. “Increasing revenue collections, curbing unnecessary expenses, better use of government funds and increase in the allocation from the (Delhi) government is needed so that arrangements related to sanitation, street, waterlogging can be improved,” Kumar said.

According to the MCD budget proposals, sanitation sector received the highest allocation in the budget, accounting for 28.86% of the total, followed by 20.83% for general administration, 10.78% for public health and medical relief, 9.96% for education, 2.31% for horticulture, 4.62% for development, 3.93% for loan repayment, among other sectors.

The ₹4,907.1 crore allocation for sanitation is an increase from ₹4,305 crore in 2024-25. Development expenses, loan repayments, and horticulture work received smaller allocations.

Kumar tabled the annual budget proposals for 2025-26 and revised budget estimates for 204-25 before the house of councilors.

This is the third consecutive year that the budget has been presented directly in the House instead of the Standing Committee due to the AAP-led Delhi government’s failure to constitute the key panel, which oversees MCD finances. The budget presentation was further delayed due to the Model Code of Conduct during the recent Delhi Assembly elections.

According to the Delhi Municipal Corporation Act, 1957, the corporation needs to approve the tax, levies and cesses for the next financial year before February 15. The remaining project proposals can be approved till March 31.

Kumar outlined MCD’s revenue structure, stating that for every ₹1 earned, 58.24 paise comes from taxes, 19.65 paise from the Delhi government’s tax share, 4.97 paise from rent, fees, and fines, and 17.09 paise from other sources. The projected income for 2025-26 stands at ₹16,701.04 crore, against estimated expenditure of ₹17,002.6 crore.

Kumar said that no new taxes have been introduced, but MCD plans to widen its tax net through strategic measures.

MCD property tax department has collected ₹1,908.06 crore till January 2025 in comparison to ₹1692.41 crore – marking a net increase of 11.3%.

The civic body will collaborate with banks and utility agencies to integrate property tax collection with electricity, water, and gas bills. This will be coupled with mapping and drone-based surveys. Secondly, all properties under MCD will be brought under GIS-mapped digital register with real-time tax collection and tracing.

“This is expected to lead to an increase of 20% in tax collection,” Kumar said. MCD has so far geotagged 484,484 properties.

While no major new infrastructure projects were announced, MCD will prioritise completing ongoing works, including the Sultanpuri and Kishanganj railway underpasses, as well as the construction of a new office complex in Karkardooma. Additionally, MCD’s engineering department will undertake projects worth ₹522 crore under the Gramoday Abhiyan to improve civic infrastructure in villages, particularly in Rawta and Daurala in Najafgarh, which have been designated as model villages.

The House passed the schedule of taxes through a voice vote by the leader of the house Mukesh Goyal, though two other key agenda items — staffing proposals and remaining budget approvals — will be discussed later.

The opposition, led by the BJP’s Raja Iqbal Singh, welcomed the decision to keep tax rates unchanged but criticised the AAP government for bypassing the Standing Committee.

“As per the Delhi Municipal Corporation Act, the budget must be presented to the Standing Committee by December 10. Even after its members were selected, AAP failed to constitute the committee, forcing the Commissioner to present the budget directly in the House with approval from the Lieutenant Governor… By not forming a standing committee, the AAP government has stopped the development works and set Delhi back by ten years,” he said.