Constitution of India · Section Article 243H
Powers to impose taxes by, and Funds of, the Panchayats
Article 243H — Powers to impose taxes by, and Funds of, the Panchayats
The Legislature of a State may, by law,—
- (a) authorise a Panchayat to levy, collect and appropriate such taxes, duties, tolls and fees in accordance with such procedure and subject to such limits;
- (b) assign to a Panchayat such taxes, duties, tolls and fees levied and collected by the State Government for such purposes and subject to such conditions and limits;
- (c) provide for making such grants-in-aid to the Panchayats from the Consolidated Fund of the State; and
- (d) provide for constitution of such Funds for crediting all moneys received, respectively, by or on behalf of the Panchayats and also for the withdrawal of such moneys therefrom, as may be specified in the law.
Plain English Summary
This article gives the State Legislature the power to decide which taxes, fees, and duties local Panchayats can collect, manage, and use. It also allows the State Government to assign certain taxes to Panchayats and provide them with financial grants to help them function. Essentially, it defines how local self-governments can raise money and manage their finances.
Key Points
- The State Legislature can create laws authorizing Panchayats to levy, collect, and use specific taxes, duties, tolls, and fees.
- The State Government can assign certain taxes collected by the State to be managed by a Panchayat.
- The State can provide financial assistance (grants-in-aid) to Panchayats from the State's main fund.
- It provides for creating specific funds to track all money received by and on behalf of Panchayats.
Why It Matters
This article is crucial because it establishes the legal framework for local self-government bodies (Panchayats) to generate their own revenue and manage their finances effectively, which is the backbone of local governance.
Landmark Judgements
No major landmark judgements.