C.8. Urban Local Finance
As allowed by the relevant municipal regulations, Municipal Corporations and Municipalities raise their funds from a variety of sources.
Their sources of income originate from
- Taxes; (ii) Fees and Penalties; and (iii) Income from Municipal Enterprises, such as Land, Tanks, Markets, Shops, etc
- Additionally, the State provides grants to these organizations.
- The primary source of revenue for the majority of urban municipal governments is the property tax on land and structures.
- They also levy taxes on professionals, advertisements, and other things. In Western India, octroi is still a significant source of revenue for local governments.
- The current trend is to abolish this charge because it interferes with the smooth flow of traffic on highways.
- For violations of local laws and ordinances, municipalities also impose fines. Municipalities frequently make substantial money through their stores, marketplaces, and rest areas.
- States frequently give grants to their municipal organizations to boost their financial situation. State grants-in-aid may be given on an as-needed basis or by specified criteria, such as population size, the concentration of slums in an area, the location of the town, etc.
- Urban bodies collect a variety of taxes and fees, including property tax, sewerage tax, fire tax, animal and vehicle tax, theatre tax, duty on property transfers, octroi duty on some commodities transported into the city, education cess (tax), and professional tax.