Revenues of P.R.

Institutions of Andhra Pradesh

Profile of Panchayats in Andhra Pradesh

District Panchayats Intermediate Panchayats Village Panchayats

(Z.P) (MP) (GP) -

22 1098 21807

Panchayat Finance in Andhra Pradesh



 

Under the provisions of AP PR Act1994 ,Only the Gram Panchayats are empowered to levy & collect taxes. The ZP/MP have no taxation powers. However the ZP/MP get some revenue through Rents/ Leases etc.

Panchayat Fund
All the money received by PRIs. is constituted into Panchayat fund.

Panchayat fund consists of 1.Own Revenues

2. Assigned Revenues 3. Grants (Taxes & Non.Taxes etc.,) (Transfer duty, Entertainment Tax) (Central & State)

i) Untied grants (General purpose grants) ii) Tied grants (Specific purpose grants)

Revenue Structure of PRIs Own Revenue:

a)

Mandatory Taxes
1. 2. 3.
i. ii. iii.

House tax Tax on Advertisement Special taxes on Houses

Drainage tax Lighting tax Water tax

b) Optional Taxes 1. Vehicle tax 2. Tax on Agricultural land 3. vacant land tax

c) Non-Taxes Fees and Fines Non1. 2. 3. 4. 5. 6. 7. 8. Licence fee (Trades & Business) Encroachment fee Layout fee Permission fee for Buildings Monthly fee on Tap connections Fines Fishery Rentals Ferry Rents

House tax


House tax is levied on the basis of Annual Rental value or capital value basis Prior to 2000-2001 general revision of house tax was done once in 5 years. From 2000-2001 onwards house tax is increased at a flat rate of 5% every year.

Special Tax on Houses

  

Gram Panchayats levy special taxes on houses, in the shape of water, drainage & lighting tax In addition to this 8 Ps in every rupee is collected towards library cess Library cess amount collected is transferred to Department of Libraries

Rates of Special Taxes

Nature of tax
a) b) c) Water supply Lighting tax Drainage tax

Maximum rate
-10% 15%

Minimum rate
20% 5% 10%

Government has issued orders in 2002 for collection of actual expenditure on lighting, water etc., as to cover O&M cost as user charges.

Rates of House Tax

Basis of levy
On capital value basis (CV) On annual rental value basis (ARV)

Minimum Rate PA
1/8 % of CV 2% of ARV

Maximum Rate PA
1% of CV 20% of ARV

Buildings exempted from House Tax:

Cattle Pounds Cattle Sheds Poultry Sheds Dairy Sheds Buildings of Union Government NGOs home

Advertisement Tax


The advertisement tax is collected by the Gram Panchayats on every advertisement which is erected , exhibited or displayed to public view. This tax is not collected on any advertisement or notice relating to Public meeting Business of railway administration Election related matters

Rates of Advertisement Tax

In Rupees

Sl. No.
1 Non illuminated:

Particulars

Maximum amount per annum

4.50 9.25 6.75

a. Space upto 1 Sq. Mtr b. For a space over 1.00 Sq. Mtr c. For every additional 2.50 Sq. Mtr or part thereof 2 Illuminated: a. For a space upto 5.00 Sq.Mtrs b. For every additional 5.00 Sq.Mtrs.

32.50 32.50

Vehicle Tax
Vehicle tax is collected by the Gram Panchayats on any kind of carriage, car, bicycle, rickshaw, etc., other than motor vehicles. The rates are indicated below.
In Rupees

Description of Vehicle
Four-wheeled vehicle drawn by animals Two-wheeled vehicle drawn by animals Bicycle

Maximum Tax 50.00 20.00 10.00

Minimum Tax 20.00 10.00 5.00

This tax is more in the nature of regulatory measure, rather than a revenue yielding sources

Assigned revenues
The assigned revenues of Panchayats are (2) types


Tax revenue or revenue assignments

Profession tax Entertainment tax

Tax supplement or revenue sharing

Surcharge on stamp duty Seigniorage fees Water cess

Profession tax
   

Upto 1987 profession tax was collected by Gram Panchayats From 1987 profession tax is collected by commercial tax department 95% of profession tax collected is passed on the local bodies by making provision in PR budget The amount is distributed to Gram Panchayats on Per capita basis

Entertainment Tax
 

Entertainment tax is collected under AP Entertainment Tax Act, 1939 90% of the proceeds of tax collection is adjusted to Gram Panchayat, Mandal Parishads in the ratio of 60:40 of the 10% balance, 3% is credited to film development corporation and 7% is retained by Government as Estt. Charges

Surcharge on stamp duty



PRIs are allowed Transfer duty (Surcharge on stamp duty) @2% on the value of transaction over and above stamp duty of 7% and registration fee of 0.5%. This transfer duty assigned to Gram Panchayat, Mandal Parishad and Zilla Parishads in the ratio of 60:20:20

Seigniorage fee


Seigniorage fee (Cess on Minor Minerals) is collected by Mines & Geology department Sand Auctions are however being conducted at District level Seigniorage fee collected by Mines department is adjusted to State funds Seigniorage fee is released to Panchayat Raj Institutions through budgetary provision

The Apportionment is
Zilla Parishad Mandal Parishad Gram panchayat 25% 50% 25%

Seignior age fee is released only to those Gram Panchayats from where actual Mining was done

General purpose grants (Untied grants)

1.

Per Capita Grant a) Zilla Parishad @ Rs.4/b) Mandal Parishad @ Rs.8c) Gram Panchayat @ Rs.4/Incentive Grants for Tax collection Incentive Grants for Unanimous Election

2.

Grants in -aid
a) b) c) d) e) f) Salary grant Honorarium & TA to non officials Per Capita grant BRGF Central /State Finance Commission grant Engineering grants i) Rural Water Supply
ii) Rural Sanitation iii) Roads & Bridges iv) School buildings etc.,

General funds of PRIs.

The General funds of PRIs consist of : a) Taxes & Non-Taxes. b) Assigned Revenues. c) General Purpose grants (Untied funds).

Utilisation of General Funds

The Zilla Parishad / Mandal parishad general funds are utilized for
1. Maintenance of existing Assets 2. Development of SCs 3. Development of STs 4. Development of Women & Children 5. Office Administration 6. Drinking Water in emergencies 7. Contingencies 34% 15% 6% 15% 16% 9% 4% --------------Total: 100% ---------------

Lodging of funds:


Under the provisions of AP.PR Act, 1994 all the funds received by the Panchayats are to be lodged in the Govt. Treasury only. The funds are kept in separate deposit accounts under the head 8448 MH(109) SH(01) SH(02) SH(03) 001 002 005 Deposits of Local Fund Panchayat funds G.P. funds M.P. funds Z.P. funds General funds Education funds Spl.Development funds

Categorization of funds at Treasury:



The Panchayat funds lodged in Treasury are categorized as Lapsable funds and Non-lapsable funds. The General funds of PRIs are Non-lapsable. The Salaries and TA grants are lapsed in the same financial year. The specific purpose grants released during a financial year are available for utilisation till the end of next financial year. The Treasury authorities will credited back to Government the unspent balances as on 31st March which are lapsed out of Lapsable grants.

  

Z.P. Engineering funds:



With effect from 01.04.2001 the grants meant for works programme in respect of Zilla Parishads are released to Pay & Accounts Officer. The accounts are maintained by the P.A.O. and bills are paid after pre-audit. However, the Receipts and Expenditure of Engineering grants are incorporated in the Budget and the Annual Accounts of Zilla Parishads.

 

Financial Statements


The Executive Officer place before the General Body quarterly a statement of Financial position. This contains a. Balance under each Account b. The amount of outstanding bills pending payment c. The demand collection & balance of own revenues d. The amount of estimated expenditure for the remaining months of the year e. This will help the Panchayats to know its financial position and plan its activities.

AUDIT


The statutory Auditor of Panchayat Raj Institutions is the Director State Audit The Statutory Auditor has the power to surcharge the loss for irregular payments against the officer responsible The Director of State Audi works under the Technical supervision and control of C & AG In addition to statutory audit the Accountant General also conduct Test Audit