Current Affair 1:

This article is based on the latest report released by RBI:

Municipal revenue receipts, which were subdued during 2020-21, grew by 22.5 per cent in 2021-22 mainly due to rise in non-tax revenues.

The revenue receipts of MCs, including own tax revenue, own non-tax revenue, and transfers, amounted to 0.6 per cent of GDP in 2023-24 (the same as in 2019-20).

Tax revenues are the largest source of revenue of the MCs (30.0 per cent of the total revenue receipts) followed by revenue grants, contributions, and subsidies (24.9 per cent) and fees and user charges (20.2 per cent).

The ratio of MCs’ tax and non-tax revenue to the respective State government’s tax and non-tax revenue varied across States, indicating a vertical imbalance. The MCs in Delhi and Maharashtra have higher ratios in both tax and non-tax revenue, while those in Sikkim and Tripura are lower.

Example:

The share of revenue expenditure in total expenditure of the MCs has declined from 43.9 per cent in 2019-20 to 38.5 per cent in 2023- 24 (BE) with concomitant (associated) increase in capital expenditure share from 56.1 to 61.5 per cent.

Within revenue expenditure, the share of committed expenditure (establishment expenses, administrative expenses and interest and finance charges) has moved in a range of 50.7 to 55.6 per cent during 2019-20 to 2023-24 (BE).

 

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