New Delhi : Even while the states keep pressing the Centre for a higher share from the proposed goods and services tax (GST), municipalities on Wednesday emerged as yet another claimant for a cut from the pie.
Urban Development Minister M Venkaiah Naidu rooted for the municipalities’ share, declaring that he would press Finance
Minister Arun Jaitley to earmark a share of the GST revenue for them, since they are among the weakest in the world in terms of access to resources, financial autonomy and revenue-raising capabilities.
Octroi was one source of income for the municipalities. But this is no longer the case as it has been abolished in most states, Naidu underlined, while addressing a workshop on the governance, administrative reforms and capacity-building of the local bodies.
His worry was that cities and towns will rot if their municipalities have hardly any money left for development and mandated functions after spending most of their revenue in paying salaries.
Quoting from a report of the McKinsey Global Institute, he noted that the annual per capita income of all the municipalities was only Rs1,430 as against the expenditure commitment of Rs 6,030.
Unless the urban local bodies have a predictable and guaranteed resource flow, they are destined to collapse, Naidu said, while stressing that only by giving them a part of the share from the GST revenue can a healthy growth be achieved for them.
