Gram Panchayats should be delegated more authority and power to raise revenue from local taxes to make them more citizen-oriented and ensure proper implementation of the 73rd Constitutional Amendment Act of 1992, according to a World Bank policy research paper released last week. 

Over three decades after the passage of the 73rd Amendment, which was aimed at decentralisation of power and decision-making from the Centre and states to PRIs, “Panchayats are not quite independently functioning units. They rely almost entirely on grants made by state and national authorities,” the paper underlines.

“Panchayats’ autonomy will always be curtailed if they cannot raise revenue levels from above the very low-levels at which they stand. Tax collection by Panchayats could improve with devolution of functions: when Panchayats are seen to be responsible for a wider range of tasks, their legitimacy improves in the eyes of the citizens, which could translate to greater local revenues,” the paper says.



Two Hundred and Fifty-Thousand Democracies : A Review of Village Government in India (English) 

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