MCD falls short on property tax target, plans two-way approach to expand base

Therefore, the civic body now plans to change its approach by integrating its tax database with building, licensing, and electricity data during the current FY.

Despite an active amnesty scheme throughout 2025-26, the Municipal Corporation of Delhi (MCD) fell short of its target property tax collection for the fiscal by over ₹350 crore, officials said on Sunday, adding that only a fraction of property owners in the city paid taxes.

Data shows that for 2025-26, MCD collected ₹3,116 crore from 1.352 million properties, well below the target of ₹3,500 crore. (Pixabay/Representative Image)

Therefore, the civic body now plans to change its approach by integrating its tax database with building, licensing, and electricity data during the current financial year, they added.

property tax

Data shows that for 2025-26, MCD collected ₹3,116 crore from 1.352 million properties, well below the target of ₹3,500 crore. The civic body had earlier targeted ₹4,000 crore in 2024-25. In terms of the number of tax payers, the city has reached close to the 2022-23 figure.

An MCD official said that even though the scheme helped add 111,909 new taxpayers to the system, retaining that growth remains the challenge. The number of tax-paying properties in Delhi was 1.329 million (13,29,641) in 2022-23, when another amnesty scheme was active. However, it dropped to 1.211 million (12,12,683) in 2023-24 and 1.133 million (11,33,161) in 2024-25.

“In contrast, there are around 3 million water and 7.3 million power connections in the Capital. As per Delhi Municipal Corporation Act, even vacant land can be taxed but coverage remains very low,” the official said.

According to the MCD action plan, it will undertake a two-way approach to expand its tax base in the 2026-27 fiscal. “We will bring new properties under the tax net using building department data (sanctioned plans and completion certificates); health, trade and licensing data from zonal offices; and electricity connection data to identify occupied but un-assessed properties,” the action plan states. The property tax wing will also launch drone surveys and door-to-door exercises to map unassessed properties. Geo-tagging of properties will be carried out to ensure accurate mapping and database cleansing,” the report, seen by HT, states.

Last year, the MCD conducted a pilot project to use the electricity consumer database to add more properties to the tax base. During the exercise, a common database was used to cross check 10,000 properties, and 400 violators were found.

MCD officials said these 400 properties paid residential taxes despite operating commercially.

Notably, MCD’s previous attempts at geotagging Delhi’s properties did not yield encouraging results. In 2023-24, MCD made geotagging mandatory but only 3,80,000 properties were tagged by the end of the financial year.

MCD launched property tax amnesty scheme SUNIYO last year. Under this scheme, property owners can get interest and penalties waived by clearing the current year’s tax along with dues from the previous five years. Under the scheme, ₹1,236 crore in property tax was collected from 206,861 taxpayers. Of this amount, ₹242.87 crore was collected from over 147,000 residential properties, while ₹993.52 crore was collected from over 59,000 non-residential properties.

Launched on June 1, 2025, the scheme has undergone multiple extensions in September, December, January, and February, with the latest deadline extended to April 30, 2026.

BS Vohra, who heads the East Delhi RWA Federation, said previous efforts to widen the tax net yielded little result. “In the end, the same 1.2-1.3 million taxpayers continue to pay for the entire city. The MCD has not even ventured into many unauthorised colonies.”