Punjab Notifies Property Tax Hike for Residential and Commercial Buildings
Babushahi Network
Chandigarh, June 5, 2025 – The Punjab government has notified an increase of 5% in property tax rates for residential houses, flats, and commercial buildings (excluding multiplexes) across Urban Local Bodies (ULBs) in the state.This decision has been done by aligning with the Government of India’s mandate to access additional borrowing limits and funding under centrally sponsored schemes of the Ministry of Housing and Urban Affairs (MoHUA). The directive, issued by the Department of Local Government on June 5, 2025, under Notification No. 3/1/21-1lg3/786, sets revised floor rates for property tax in accordance with prevailing circle rates.The new rates are applicable for the financial year 2025-26 means implemented from April 2025.
The notification references earlier directives dated February 14, 2021, and April 26, 2021, which outlined the framework for property tax rates which says the annual hike should be 5 %. The updated rates apply to:
This move is part of Punjab’s compliance with the Central government’s requirement to standardize property tax floor rates to unlock an additional borrowing limit of 0.25% of the Gross State Domestic Product (GSDP). The move aims to bolster municipal finances and support urban development initiatives under MoHUA schemes.
This meaning by increasing property tax now Punjab government will be able to avail 0.25 percent more loans than the present limit fixed by Government of India.