New Delhi, July 24: NOIDA has recently been granted a “tax-free” status — but before residents and businesses start celebrating, it’s important to decode what this really means. On July 17, 2025, the Central Board of Direct Taxes (CBDT) notified that the New Okhla Industrial Development Authority (NOIDA) will be exempt from paying tax on certain types of income under Section 10(46A) of the Income-tax Act, effective from the assessment year 2024–25. However, this exemption is meant for the NOIDA Authority itself, not for the general public or businesses operating in the area.

The CBDT clarified that only specific kinds of income — such as rent from public utilities, government grants, and service fees — earned by the NOIDA Authority are exempt. Income from any commercial or profit-making activities by the Authority will still be taxable. This financial relief is expected to help the Authority focus more on infrastructure improvements without raising local taxes. What Is the Last Date To File ITR for FY 2024–25 (AY 2025–26), July 31 or September 15? What Is the Deadline To Pay Final Tax Without Penalty? All You Need To Know As Income Tax Department Extends Due Date.

Is NOIDA Tax-Free?

Not entirely. The “tax-free” tag refers mainly to relief from certain local municipal charges, not a complete tax holiday for everyone in the city. This includes temporary exemptions on property tax, holding tax, and sometimes utility charges like water and sewerage — but only in selected zones and for a limited period (usually 3 to 5 years). All other taxes — including income tax, GST, and stamp duty — still apply to individuals and businesses. ITR-1 and ITR-4 Released for AY 2025–26: Salaried Taxpayers Can Report Capital Gains Up to INR 1.25 Lakh in Simplified Forms, Check Other Key Changes.

Will Residents of Noida Not Have To Pay Tax From FY2024-25?

No, residents will still have to pay most taxes. If you live in a notified “tax-free” zone, you may be exempt from paying annual house tax for a few years — a potential saving of ₹8,000 to ₹25,000 annually. However, stamp duty on property purchases, GST on under-construction flats, and income tax continue as usual. The exemption does not apply citywide and is restricted to specific sectors and housing layouts.

Who Gets Tax Exemptions and How?

The primary beneficiary of the exemption is the NOIDA Authority, not the average taxpayer. However, homebuyers in select sectors and startups or small businesses operating in notified industrial or IT zones may benefit from local tax waivers. These incentives are designed to promote urban development, attract investment, and make NOIDA more competitive with neighboring cities like Gurugram.

NOIDA’s “tax-free” label is a targeted, conditional exemption — not a universal one. While it provides local relief for some, all standard state and central taxes still apply. Residents and businesses must check zone-wise notifications to know if they qualify.

(The above story first appeared on LatestLY on Jul 24, 2025 11:55 AM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).