Study of basics Municipal Finance in India. Typical Institutional framework for Municipal Finance. Sources of Income & sectors for expenditure for a municipality in India. Case of Mehsana.

1. 1As a part of Urban Development Planning Studio 2014, Masters in Planning, CEPT University, Ahmedabad, 21 January 2014
Financeincome & expenditure
Municipal

2. 2
a u t h o r i t i e s │ i n s t i t u t i o n s │ p o w e r s │ r e s p o n s i b i l i t i e s │ r o l e s
So what does the taxes collection signify about the authority?
It signifies power, autonomy &
independence of the authority for
development over a space.

3. 3
What does the expenses indicate?
 Capacity to undertake
developmental activities
 Priorities of the authority for
development
a u t h o r i t i e s │ i n s t i t u t i o n s │ p o w e r s │ r e s p o n s i b i l i t i e s │ r o l e s

4. 4
Developmental activities
taken up by the following authorities at district level
urban rural
Collector DDO

5. 5
villages Gram panchayat
Taluka panchayat
District panchayat
Panchayat dept
State government
Institutional framework for
developmental activities
in 12 peri-urban
12peri-urbanvillages

6. 6
Taxes Gram panchayat
House tax
Light tax
Professional tax
Cleanliness tax
R u r a l

7. 7
Gram panchayat │ Taluka panchayat │ District panchayat
Land revenue
जमीन महसूर
Taxes
R u r a l

8. 8
13th Finance Commission Grant
Annual Grants
MP – MLA Fund
Highdependencyratio
Grants
R u r a l

9. 9
abc
Special Grants
xyz
Highdependencyratio
Grants
R u r a l

10. 10
Urban
Municipality
Collector
State Government
Institutional framework
for developmental
activities in
areas
- Approvals
- Forward funds
- Implementation
- Planning
- Identification
M e h s a n a
roles

11. 11
Mehsana Municipality
Taxes & own Income
grants
income
Income
Sources
Mehsana
Municipality

12. 12
Income
Opening balance
Mehsana
Municipality
2013 - 2014
Own income
Grants & Funds 34.80 crore
20.75 crore
33.75 crore
89.30 crore
own income
grants & funds
60%
40%
Income–dependencyratio
As per Mehsana Municipality Budget 2013-14

13. 13
Taxes &
Charges
Mehsana
Municipality
2013 - 2014
User charge
Property Rent
Water Tax
Penalty
Electricity Tax
Conservancy tax
Professional Tax
Water Charge
Property Tax
Gutter Tax
TP Betterment charge
Impact Fee
60%70%of total own income
(20.75 crore)
Income-ownincome

14. 14
Taxes &
Charges
Mehsana
Municipality
2013 - 2014
Thumb rules
Professional Tax
Water Charge
Property Tax
Area municipality limit : 3145 hec Population : 1.90 lakhs
Rs. 6,500/-
Rs. 11,000/-
Rs. 22,000/-
For 1 hectare inclusion of area in Mehsana municipality …approx.
With FSI remaining same…
Other Tax Rs. 10,000/-
Approx. Rs. 50,000/- p.a.
Income-ownincome-annual

15. 15
Taxes &
Charges
Mehsana
Municipality
2013 - 2014
Thumb rules
TP Betterment charge
Area municipality limit : 3145 hec Population : 1.90 lakhs
Rs. 1,50,000*/-
For 1 hectare floating of TP scheme … approx.
Income-ownincome–onetime
Collected over 10 years sometimes...

16. 16
Grants
Mehsana
Municipality
2013 - 2014
Income-grants
Annual Grant
Special Grant
Basic per capita
16
Entertainment tax
Land revenue
Octroi grant
Urban development
G.M.F.B.G.
Cleanliness abhiyan
Town planning grant
Health staff subsidy
D.A.Allowance
Water works Grant
Pay & use grant
Flood Relief fund
S.J.C.M.UD yojana(DUDA)
15%Vivekadhin
Incentive conservancy
Nirmal gujarat
S.J.yojana
S.J.S.R.Y (Loan subsidy)
Amrut Dhara
Mission mangalam
Town planning admin

17. Revenue Grants
G.M.F.B.G(State)
Pay & use grant(State)
Cleanliness abhiyan yojana(State)
Road repair & main. (State)
Town planning Grant(State)
Malaria prevention(State)
Shop & Establishment(State)
Basic per capita grant(State)
S.J.S.R.Y (Lone subsidy) (State)
Cable T.V. (State)
Proffessional Tax(State)
Entertainment tax(State)
Nirmal gujarat grant(State)
Land revenue grant(State)
Octroi grant(State)
Health staff subsidy(State)
Town planning admin(State)
S.J.S.R.Y admin. (State)
District administration(State)
Town planning admin(State)
Incentive conservancy(State)
U.C.D.Grant subcidy(State)
New Anganvadi Grant(State)
M.L.A.Grant(State)
M.P.Grant(central)
Flood Relief fund(State/(central))
Urban development(State)
Amrut dhara(State)
12th Finance commission(central)
S.J.C.M.U.D (DUDA) (State)
Water works(State)
13th Finance commission(central)
15%Vivekadhin Grant(State)
Capital Grants

18. • G.M.F.B.G
• S.J.C.M.Urabn development
yojana(DUDA)
• Incentive conservancy
• Clinliness abhiyan Grant
• Pay & use grant
• Water works Grant
• Amrut dhara
• Swarnim jayanti C.M.urban
developement yojana
• 15%Vivekadhin Grant
• Cable T.V.
• Road repair & maintainance
Physical Infrastructure
• Nirmal gujarat grant
• Urban development grant
• Shop & Establishment
• New Anganvadi Grant
Social infrastructure
Physical
Infra.
grant
17 crore
7%93%
Social
Infra.
grant
1 crore

19. 19
Expenditures
Mehsana
Municipality
2013 - 2014
Revenue expenditure
Capital expenditure 54.85 crore
20.82 crore
88.90 crore
revenue exp.
capital exp.
70%
30%
Expenditures–operatingratio–capitalutilization
Approx. Balance 13.23 crore
As per Mehsana Municipality Budget 2013-14
75.67cr

20. 20
Capital
Expenditure
Mehsana
Municipality
2013 - 2014
Urban development
Sanitary capital
IDSMT
Underground sewage
Garden capital
Water works capital
Building Capital
Elec. capital
Crematorium Capital
Road Works
30%
of capital expenditure
(54.85 crore)
Income-ownincome
56%71%

21. 21
Financial
Health
Mehsana
Municipality’s
2013 - 2014
Financial analysis