Jan Vishwas Bill 2026: New NDMC Property Tax System with Two Separate Components Proposed

New Delhi, March 28: The government has proposed a new property tax framework for areas under the New Delhi Municipal Council (NDMC) as part of the Jan Vishwas (Amendment of Provisions) Bill, 2026. The bill, introduced in the Lok Sabha on Friday by Minister of State for Commerce and Industry Jitin Prasada, aims to simplify property taxation, ease criminal provisions for minor offences, and tighten enforcement for tax violations.

The proposed legislation replaces the earlier tax structure under Section 61 of the NDMC Act, 1994, with a new system comprising two separate components: building tax and vacant land tax.

Key Changes in NDMC Property Tax

Two-Component Tax Structure

Property tax in NDMC areas will now consist of:

Building Tax – levied on constructed properties
Vacant Land Tax – levied on unused or vacant land parcels

Municipal Valuation Committee

A Municipal Valuation Committee will be set up every three years to:

Classify properties based on type and usage
Fix base values for property assessment
Recommend how taxes should be determined and revised
If revisions are delayed, values may be indexed to inflation, ensuring periodic increases

Property Identification Code

The bill proposes a mandatory Property Identification Code for each property. Residents will need this unique code for:

Property tax payments
Accessing civic services

Service Charges on Government Properties

The bill clarifies that service charges on Union government properties in NDMC areas may be levied at 75 per cent of the applicable property tax, addressing a long-standing issue in municipal finances.

Streamlined Framework

A large number of existing provisions in the NDMC Act relating to taxation and procedures are proposed to be omitted, signaling a shift away from the older framework toward a more standardized, formula-driven system. New definitions, including those for annual value, vacant land, and the valuation committee, have been inserted to support this change.

Amendments to MCD Act, 1957

The bill also seeks to rationalize penalties and improve compliance under the Delhi Municipal Corporation (MCD) Act, 1957:

Clear Timelines for Assessment

Tax authorities are barred from reopening cases beyond seven years, except in instances of wilful suppression of information by the taxpayer.

Penalties for Tax Evasion

Penalties for tax evasion will be linked directly to the amount evaded, with fines of at least 50 per cent of the evaded amount. Serious cases may still invite imprisonment.

Alignment with New Criminal Codes

The proposed amendments update legal references in the MCD law to align with the new criminal codes, including the Bharatiya Nyaya Sanhita, 2023.

Objectives of the Bill

The Jan Vishwas Bill 2026 aims to:

Simplify property taxation in NDMC areas with a clear two-component structure
Ensure periodic revisions of property values through a dedicated valuation committee
Improve compliance with stricter timelines and rationalized penalties
Reduce litigation by providing clarity on tax assessment and revision mechanisms
Modernize municipal laws by aligning with new criminal codes

Significance

The proposed reforms mark a significant shift in how property tax is administered in Delhi's NDMC areas. The introduction of a Municipal Valuation Committee ensures that property valuations keep pace with market realities, while the two-component tax structure provides greater clarity for property owners.

For Union government properties, the clarification on service charges (capped at 75% of applicable property tax) resolves a long-pending issue in municipal finance.

Outlook

With the bill now introduced in Parliament, it will be referred to the relevant parliamentary committee for review before being taken up for debate and passage. Once enacted, the new property tax framework will come into effect in NDMC areas, bringing greater transparency and predictability to property taxation in the national capital.

Property owners in NDMC areas should prepare for t