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Delhi civic body identifies commercial users paying residential tax

If you are utilizing a commercial electricity connection while paying property tax at residential rates, it is important to take caution. You may soon receive a notification from the Municipal Corporation of Delhi. In an effort to enhance tax revenue for the fiscal year 2025-26 and to identify tax evaders, the municipal authority is examining electricity bills issued by power distribution companies.

Officials have indicated that tax inspectors have been given access to electricity bills from 10,000 commercial properties, with the verification of 3,200 properties already completed. ‘These commercial properties were chosen based on their locations. Among the 3,200 properties, discrepancies were found in 421 cases. In numerous situations, individuals were using a commercial electricity connection while paying property tax to the MCD at residential rates. The MCD will issue notices to these defaulters, requesting them to rectify their information and settle any outstanding payments to prevent further action,’ stated an official.

These electricity bills will assist in identifying individuals who are not fulfilling their property tax obligations. Prior to commencing this initiative, the civic authority established a portal where property tax inspectors are required to input information following their inspections of properties. The objective is to assign accountability. After their visits, inspectors must record details regarding the properties, their conditions, and any discrepancies. Inspectors will be held responsible if any inconsistencies are discovered in the future, as stated by the official. The civic authority employs over 100 inspectors within the property tax department.

In the fiscal year 2024-25, the Municipal Corporation of Delhi’s property tax revenue amounted to approximately Rs 2,163 crore from 11.33 lakh properties, falling short of the projected target of Rs 4,000 crore. This amount was slightly higher than the Rs 2,137 crore collected in FY 2023-24. The MCD explained that following political announcements in February regarding a 100% exemption on property tax for properties under 100 square yards and a 50% reduction for those between 100-500 square yards, there was significant confusion among taxpayers, leading to a decrease in collections.

The civic authority recorded a higher collection of Rs 2,417 crore in FY 2022-23, which was credited to the introduction of an amnesty scheme. Additionally, the number of taxpayers decreased from 13.3 lakh in 2022-23 to 12.6 lakh in 2023-24.

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