Municipal Corporation of Delhi (MCD)- uniform tax rates for trade

The Municipal Corporation of Delhi (MCD) has announced uniform rates for general trade and storage licenses for establishments across the city.

Details:

• Revised rates are aimed at curbing “disparities” in the earlier fee rates under three erstwhile municipal corporations.
• As the Municipal governments rely heavily on property tax revenue to fund their operations and the new license rates are higher in comparison to the rates under the erstwhile municipal corporations.
• There will be an increase of 15% in the license fee for all categories every three years from the date of implementation, starting from April 1, 2025.

What is a Municipal Corporation?

• In India, the Municipal Corporation is the urban local government that is responsible for the development of any Metropolitan City having a population of more than one million people.
• Mahanagar Palika, Nagar Palika, Nagar Nigam, City Corporation, and so on are some of the other names for it.

The Municipal Corporations are established in the states by the acts of the state legislatures, whereas in the Union Territories through the acts of the Parliament.

• Municipal governments rely heavily on property tax revenue to fund their operations.
• The first municipal corporation in India was created in Madras in 1688, followed by municipal corporations in Bombay and Calcutta in 1726.

The necessity for the creation of a Municipal Corporation:

• The growing population and urbanization in India's cities necessitated the establishment of a local governing body.
• A body is needed for collecting the property taxes and fixed grants from the state government in order to provide essential community services such as health care, education, housing, and transportation.