NEW DELHI: The government has proposed a new property tax framework for the New Delhi Municipal Council (NDMC) areas, easing criminal provisions for minor offences while tightening enforcement for tax violations.
This is part of the Jan Vishwas (Amendment of Provisions) Bill, 2026, introduced in the Lok Sabha on Friday by Minister of State for Commerce and Industry Jitin Prasada.
The bill suggests a complete overhaul of the tax structure under the NDMC Act, 1994. It establishes that property tax will now consist of two components: building tax and vacant land tax, replacing the original Section 61.
To facilitate this, a Municipal Valuation Committee will be formed every three years to classify properties, set base values, and recommend tax calculations and revisions. If revisions are postponed, values may be adjusted for inflation, ensuring regular increases, as per the proposed legislation.
The bill aims to incorporate a mandatory Property Identification Code for each property, which residents will need for tax payments and civic services.
Additionally, it clarifies that service charges on Union government properties in NDMC areas can be levied at 75% of the applicable property tax, addressing a long-standing issue in municipal finances.
According to the proposed legislation, numerous existing provisions relating to taxation and procedures in the NDMC Act will be omitted, indicating a transition to a more standardized, formula-driven system. New definitions for annual value, vacant land, and the valuation committee have been included to support this initiative.
Under the Delhi Municipal Corporation (MCD) Act of 1957, the bill seeks to streamline penalties and enhance compliance. It proposes clearer assessment timelines, prohibiting tax authorities from reopening cases older than seven years, except in cases of intentional misinformation.
Tax evasion penalties will be linked to the evaded amount, with fines starting at 50%, while more serious cases may still lead to imprisonment.
The proposed amendments also update legal references in the MCD law to reflect the new criminal codes, including the Bharatiya Nyaya Sanhita, 2023.
