To fill its coffers, MCD mulls higher property tax rates

Get ready to shell out more money from next year, as the MCD is planning to increase the property tax rates.

Get ready to shell out more money from next year, as the MCD is planning to increase the property tax rates.

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Sources say, the cash-strapped Municipal Corporation of Delhi (MCD) is planning to hike property tax to generate more revenue to fund its projects.

Currently, the entire MCD area has been divided into eight categories A to H, wherein category A stands for upscale colonies such as New Friends Colony, Vasant Vihar among others.

However, sources say, as per the proposal, to be tabled in the budget meeting on Wednesday, the entire MCD area will be divided into two categories as far as tax rate is concerned wherein categories A, B, C, D, and E will be clubbed together and will pay 15% property tax while categories F, G, H will be charged 10%.

Presently category A and B are charged 12%, C, D and E are charged 11% and F, G and H are charged 7%.

“The MCD’s financial position is not very sound and property tax is a major source of revenue for the MCD. Even last year, the rates we had suggested were reduced by the legislative wing. We hope this year they will accept it,” said a senior MCD official.

This year, too, the civic body had increased tax rates. According to the civic agency, its property tax collection has been going down every year.

The civic agency has been trying to bring more people into the ambit of tax collection to increase collections and has been conducting a survey to identify property owners who have not made payments. Besides this, they have offered rebate in additional interest and penalty to encourage taxpayers to pay arrears.