The Kolkata Municipal Corporation has approved a time-bound property tax waiver that will reduce penalties by 99 per cent and interest by up to 80 per cent for eligible taxpayers, as the civic body seeks to recover dues from 386,288 defaulters across the city.
The scheme, called the Kolkata Municipal Corporation Incentive (Waiver of Interest and Penalty to the Property Tax Payers) Scheme, 2026, has received approval from the West Bengal government, according to the report. It will remain effective until March 2027 and may be extended by another two months if required, KMC administrator Smita Pandey said.
The civic body has reported outstanding property tax of Rs 6,854.29 crore. This includes penalties of Rs 401.38 crore and accumulated interest of Rs 3,314.13 crore. The principal amount due, according to the municipal commissioner, is Rs 3,138.76 crore.
Under the approved structure, properties containing both residential and commercial units will receive an 80 per cent waiver on interest and a 99 per cent waiver on penalties. For commercial properties, the interest waiver will be 70 per cent, while the penalty waiver will remain 99 per cent.
The relief will be available for six months from the date of notification. KMC authorities will also allow taxpayers to clear their dues through six monthly instalments. Government properties will receive a 100 per cent waiver, Pandey said.
The scheme follows a proposal sent by the civic body to the state secretariat, Nabanna. The decision comes as KMC attempts to increase property tax collection, which officials said remains below the targeted amount. The reported timing also comes ahead of the expected announcement of civic polls, although the supplied report does not provide a specific election schedule.
For taxpayers, the structure separates the underlying property tax from the additional financial burden created by penalties and accumulated interest. The principal amount of Rs 3,138.76 crore represents the core tax dues identified by the civic authorities, while the interest and penalty components together account for a substantially larger sum.
The six-month payment window and instalment option are intended to enable defaulters to settle outstanding amounts without paying the full accumulated surcharge. The exact notification date, application process and taxpayer eligibility requirements were not specified in the supplied report.
The scheme’s immediate administrative challenge will be converting the reported outstanding demand into actual collections within the notified period. KMC has not provided, in the supplied information, a projected recovery target or a ward-wise distribution of the defaulters and dues. The waiver will remain available until March 2027, with a possible two-month extension, according to the administrator.
