A case for professional tax in India4 min read . Updated: 27 Jan 2016, 01:45 AM IST
Revenue enhancement of municipalities is needed to address the yawning infrastructure gap in our cities
There are approximately 4,000 municipalities in India, with aggregate revenues of less than ₹ 1 trillion, which includes grants from central and state governments and loans. Urban India is estimated to need capital expenditure of the order of around ₹ 3 trillion per annum, besides additional funds for revenue expenditure. A substantial portion of these monies will need to be raised by municipalities themselves, given that state and central funds are spread over various equally important priorities. One revenue stream that could hugely empower municipalities is professional tax. They can reap the benefit of a rapidly urbanizing population and a concomitant increase in the workforce by paying greater attention to mobilizing professional tax.