Shimla MC Cracks Down on Property Tax Defaulters to Tackle Financial Crisis

The Municipal Corporation (MC) of Shimla has intensified its efforts to recover unpaid property taxes by cutting off electricity and water connections of over 400 defaulters. The civic body has disclosed that more than 5,000 property owners collectively owe over ₹6 crore in unpaid taxes, severely hampering revenue collection. Despite multiple notices, many defaulters failed to comply, prompting this decisive action. “We urge residents to settle their dues promptly to avoid further inconvenience,” a senior MC official stated.

One of the major defaulters is the Interstate Bus Terminus (ISBT) in Tutikandi, which owes a staggering ₹6.33 crore in taxes. In a bold move, the MC has resolved to disconnect its water and electricity connections, underlining its determination to recover dues even from prominent establishments.

Tax Evasion Hindering Civic Development

Shimla has around 31,000 buildings, making property tax a vital revenue source for the MC. However, tax evasion remains a persistent challenge despite incentives like a 10% rebate for timely payments and penalties for late submissions. The lack of compliance has significantly impacted the corporation’s ability to finance essential services and development projects, including waste management, road repairs, and water supply enhancements.

This crackdown comes amid a severe financial crunch faced by the MC, which has long been overly dependent on government grants. Experts have pointed out that internal revenue generation is falling short of the city’s growing needs, delaying critical civic projects.

Strengthening Fiscal Discipline

To address this crisis, the MC is not only tightening enforcement of property tax regulations but also exploring ways to diversify its revenue streams. Officials admit that systemic inefficiencies need to be addressed to ensure long-term financial sustainability.

By taking firm steps to recover unpaid taxes, the MC aims to set an example for timely compliance, ensuring uninterrupted civic services for Shimla’s residents. However, achieving lasting fiscal stability will require a collaborative effort from both citizens and institutions to adhere to tax norms and support the city’s growth.