Question

Write the sources of income of Municipal Corporation.

Hint:

Remember the trio: {own taxes}, {user charges}, and {grants/borrowing}—together fund city services.

Answer 1

Urban local bodies finance services through their own taxes and non-tax revenue plus inter-governmental transfers. The backbone is property tax on land and buildings. Other taxes/cess include advertisement tax, entertainment tax (where applicable) and profession tax. Non-tax revenue arises from water supply, sewerage, solid waste fees, parking, markets, rents from municipal properties and building permits. Corporations also levy impact/betterment charges on developers, collect penalties and issue trade licences. Higher-level governments provide tied and untied grants, GST compensation shares, and assigned revenues such as a portion of stamp duty or motor vehicle tax. For capital projects, cities may borrow or issue municipal bonds backed by escrowed revenues.