RBI, Municipal Corporations Tax: This can be important news for those who have urban residences. An article published in the media, which is about RBI, suggested that municipal corporations should levy appropriate user fees for basic services like water supply and sanitation to generate revenue and improve public service quality. Which means city residents may have to bear more expenses in the future.
RBI on Municipal Corporations Tax, According to Report
Residing in urban areas can be costly now. An RBI report suggests that municipal corporations should levy appropriate user fees for basic services like water supply and sanitation to generate revenue and improve public service quality. The 2019-20 to 2023-24 ‘Report on Municipal Finances’ (Budget Estimates) thoroughly analyzed the financial status of 232 municipal corporations (MCs).
Municipalities have the potential to boost revenue
Specifically, the attention was placed on the topic ‘Municipal Corporations in their Own Sources of Revenue Generation: Opportunities and Challenges’. Municipalities have the potential to boost revenue that is not derived from taxes by charging fair and sufficient fees for crucial services like water supply, sanitation, and waste management. The report mentioned that implementing transparent and accountable governance practices, along with these measures, can help enhance the financial health of municipal corporations.
Stronger revenues and continuous upgrading of urban infrastructure
According to the RBI report, if this can happen, a cycle of better services to the public, stronger revenues and continuous upgrading of urban infrastructure will begin. The main non-tax revenue sources include user fees, business license fees, layout/layout fees, etc. These include building sanction fee, development fee, improvement fee, sales and rent fee, market fee, slaughter house fee, parking fee, birth and death registration fee. Sources of tax revenue include property tax, vacant land tax, water gains tax, advertisement tax, sewerage benefit tax, tax on livestock and tax on vehicles.