Stamp duty is a tax imposed on legal documents to make them legally valid. In the context of real estate, it is payable during the transfer of property ownership and is calculated based on the property's value or the transaction value, whichever is higher.

Stamp Duty Rates in 2025

Stamp duty rates in India vary across states and are subject to periodic revisions. As of 2025, the rates are as follows:

• Delhi: 4% to 6%
• Mumbai: 5% to 6%
• Chennai: 7% and 4%
• Kolkata: 4% to 5%
• Gujarat: 4% to 7.5%
• Kerala: 8%
• Maharashtra: 3% to 5%
• Tamil Nadu: 7%
• Uttar Pradesh: 5% to 7%
• West Bengal: 5% to 7%

Several factors affect the stamp duty rates applicable to a property:

1. Property Location: Urban properties often attract higher stamp duty compared to rural areas.
2. Property Usage: Commercial properties may have higher rates than residential ones.
3. Owner's Gender: Some states offer lower rates for female property owners to encourage women's ownership.
4. Property Value: Higher-valued properties may fall into higher stamp duty brackets.

The Indian government is working on modernizing the stamp duty framework. A draft of the Indian Stamp Bill, 2023, has been released for comments, aiming to replace the existing Indian Stamp Act of 1899. This initiative seeks to align the law with contemporary requirements, including provisions for e-stamping of digital instruments, reflecting the government's focus on e-governance.

Stamp duty can be paid through various methods:

• E-Stamping: An electronic method of paying stamp duty, available in many states.
• Non-Judicial Stamp Paper: Traditional method involving physical stamp papers.
• Franking: A process where an authorized franking agent stamps the document, indicating that stamp duty has been paid.

Failure to pay the requisite stamp duty can lead to legal complications, including:

• Document Inadmissibility: Documents not duly stamped may not be accepted as evidence in court.
• Penalties: Authorities may impose fines or penalties for evasion or underpayment of stamp duty.

Understanding stamp duty is crucial for anyone involved in property transactions in India. Staying informed about the current rates, payment methods, and legal implications ensures compliance and facilitates smooth property dealings.