Synopsis- Property taxes are an important source of income for the municipal corporations of cities in India, as these taxes create revenue that can be used for public services and infrastructure improvements. However, tax rates and collections differ widely from city to city, impacting homeowners and investors alike.
The article identifies the Indian cities with the highest property tax rates for the year of 2025, explains how property tax rates are computed, and summarizes some salient developments affecting property tax collections in India.
1. Mumbai
- In Mumbai, property tax rates range between 0.316% and 2.296% of the government tax assessed capital value.
- For most residential holders of property, rates vary from 0.2% to 1.5%; however, properties with lots of luxury features and properties in premium wards can reach much higher rates.
- Notably, the Brihanmumbai Municipal Corporation (BMC), recorded an unprecedented ₹6,198 crore in property tax collections for FY 2024-25, due, famously, to both higher-than-average property values in Mumbai, plus MCGM’s much more robust collection and enforcement efforts.
2. Bengaluru
- Bengaluru imposes property tax rates that fall between 0.5% – 1% of the annual value of the property as taxes are calculated based on the Unit Area Value method.
- Bruhat Bengaluru Mahanagara Palike (BBMP) collected close to ₹4,930 crore in taxes for FY 2024-25 as a result of strong enforcement, digitization, and auctioning of properties of defaulters for the first time.
3. Hyderabad
- The city operates a slab-based property tax system
- Tax generally varies from ₹0.5 to ₹3 per sq ft based on property classification on a monthly basis for residential properties.
- The Greater Hyderabad Municipal Corporation (GHMC) in FY 2024-25 officially collected ₹2038.42 crore property tax for FY 2024-25.
4. Delhi
- Delhi property tax rates range from 0.5% to 3% of the property’s annual value, based on the property location, zone, other property characteristics, and the behaviour of property use.
- The Municipal Corporation of Delhi (MCD) had collected approximately ₹2,024 crore for FY 2024-25, but still came up short of its ambitious target.
- Premium zones with high property values experience the most substantial civil tax outflows.
Also read: Top 10 States in India with Best Public Transport Facilities in 2025
5. Chennai
- Average ranges for property tax rates in Chennai vary depending on the yearly values; typically 0.2% to 1.5%.
- The assessment includes consideration of the location, plinth area, nature of use, and age of construction.
- The Greater Chennai Corporation (GCC) exceeded ₹2,000 crore during FY 2024-25 for the first time, indicating a growth in urban tax receipts.
6. Ahmedabad
- Amdavad Municipal Corporation (AMC) has one of the highest property tax rates in India and has collections of more than ₹1,739 crores. The collections were the highest in the past four years.
- Efforts in digitizing tax in Ahmedabad, and strict compliance measures improved collection efficiencies and expanded the paying tax base.
7. Kolkata
- Property tax rates in Kolkata fall between 0.5% to 3% of the property’s annual value.
- The highest rates are applicable in commercial and millions of cities.
- A Kolkata Municipal Corporation (KMC) Assessment department recorded the tax collection as ₹1258. 53 crore
- The assessment uses a unique calculation for property tax based on per square foot basis value and use.
8. Pune, Thane, Pimpri-Chinchwad, Nashik
- Thane brought in ₹810 crore, Pimpri-Chinchwad collected ₹966 crore
- Nashik was at ₹256 crore in 2025, the highest it has ever collected in 40 years, thanks to incentives for digital payments and early payment discounts.
Other Rapidly Developing Cities
- Ludhiana and Mohali saw historical increases from enforcement and property seizure initiatives.
- Many districts in the southern states, such as Kurnool and Vizianagaram, crossed into new ranges of property tax conduct in FY 2024-25 period.
The Determining Factors Influencing Rates are:
- Location/zone (prime area are the most expensive)
- Type of usage (residential, commercial and industrial)
- Building age and construction condition
- Available infrastructure and amenities.
- Higher tax rates are usually associated with better roads and public services, safety and security, and available civic amenities.
Key Trends and Characteristics
- Progressive Tax Structures – In most cities, taxing properties more heavily in desirable or commercial or high-end parts of the city.
- E-Governance Push – Adoption of online payment and digitization has improved efficiency, resulting in record collections.
- Rebates and Penalty – Opportunity for rebate for early payers, while properties and increased or escalating fines for defaulters appearing on tax delinquency rosters or scheduled for auction.
- Revenue Expansion – Property tax is now India’s fastest expanding civic revenue stream and, increasingly supporting mega infrastructure project financing and smart cities.
Conclusion
Indian metros, such as Delhi, Mumbai, Kolkata, and Bengaluru, lead in the property tax rankings, as expected from economic cores of activity. Higher tax revenues can be investments into better services and infrastructure but are higher after all for the property owners. The most prudent note for buyers and investors to know about city-wise rates is the cost of ownership and making sound real estate decisions in 2025 and beyond.
Written By Rachna Rajput
