In a renewed effort to strengthen its revenue and bring fairness to the property tax system, the Municipal Corporation of Delhi (MCD) has begun identifying commercial property owners who have been underpaying taxes by falsely declaring their premises as residential. This crackdown comes after a detailed analysis of electricity bills from power distribution companies revealed discrepancies in usage and declarations.
The initiative, still in its initial phase, has already reviewed 3,200 properties out of 10,000 flagged for scrutiny. Among these, 421 were found to be using commercial electricity connections while continuing to pay property tax at residential rates — a significant violation. MCD has announced that such defaulters will soon receive notices instructing them to correct the tax category and clear any dues to avoid further action.
This targeted move is not only aimed at increasing MCD’s tax collection for the financial year 2025–26 but also at restoring a sense of equity among honest taxpayers who have been fulfilling their obligations correctly. According to officials, the exercise will also help identify those who have completely evaded property tax payments.
To ensure accountability and transparency, MCD has developed a portal where inspectors are now required to upload detailed records after every site visit. This digital trail will help monitor discrepancies and hold officers responsible if any lapse in verification is discovered later.
Despite sincere efforts, MCD’s property tax collection has not met expectations in recent years. In 2024–25, the civic body collected ₹2,163 crore from over 11.3 lakh properties — falling short of the ₹4,000 crore target. This decline was partly due to public confusion following political announcements about tax exemptions and rebates on smaller plots, which disrupted taxpayer clarity and compliance.
Notably, in 2022–23, the MCD had achieved a higher collection of ₹2,417 crore, credited to an amnesty scheme that encouraged defaulters to come clean. However, both collections and the number of active taxpayers have since dwindled, indicating a pressing need to rebuild trust and clarity in the system.
While the crackdown may seem strict, MCD officials emphasize that the focus is not punitive but corrective. They hope this initiative will remind property owners of their civic responsibility and pave the way for a more transparent and equitable taxation environment in Delhi.
