Background:
Municipalities are starved of funds.
Under Article 276 of the Indian Constitution, professional tax is levied by state governments or municipalities themselves. The constitution fixes a ceiling of Rs. 2500 per taxpayer per annum.
Way forward:
Municipalities are starved of funds.
Under Article 276 of the Indian Constitution, professional tax is levied by state governments or municipalities themselves. The constitution fixes a ceiling of Rs. 2500 per taxpayer per annum.
Way forward:
- Subsequent reports of Finance Commission have recommended for increase upto Rs. 12000 per taxpayer per annum.
- Requirement of Constitutional Amendment for revising ceiling tax rates to be replaced with parliament approval.
- Parliament should devolve the power of legislation on the subject to state legislatures which in turn should delegate it to municipalities.
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