The 15th Finance Commission headed by Chairman, Shri N.K. Singh alongwith its Members and senior officials today met with the representatives of the Urban Local Bodies (ULBs)  of  Chhattisgarh.

The Commission was informed that:

• 15 out of 18 functions as envisaged in the 12th schedule of the Constitution, have been devolved to ULBs in Chhattisgarh.   
• Chhattisgarh has a total of 168 ULBs, of which 13 are Municipal Corporations, 44 are Municipal  Councils and  111 are Nagar Panchayats.

As per the recommendations of the 2nd SFC (2012-13 to 2016-17),  1.85% of the net tax revenues of State was recommended to be devolved to ULBs  which has been accepted by the Government of Chhattisgarh.  According to the Chhattisgarh Government, the 3rd SFC submitted its report in September, 2018 which is currently under examination. 

The 14th Finance Commission had recommended for the period 2015-20, a devolution of ₹ 1270.33 crores to Chhattisgarh as Basic Grant ( 1.82 per cent of total grants) and a devolution of ₹ 317.58 crores as Performance grant ( 1.82 per cent of total grants).

The Commission observed that three of the total of 18 were yet to be devolved to the ULBs Reasons for not devolving three functions (out of 18 in total) to ULBs may be sought.

The Commission also desired to know whether ULBs have suffered any loss of revenue due to subsuming of advertisement & entertainment tax, unless levied by local bodies, in GST, and the extent of the same. The Commission also wanted to know, if any, compensatory mechanism was provided to ULBs to meet the revenue shortfall due to such subsuming

Representatives of Municipal Corporations of Raipur, Bilaspur and Jagdalpur, Municipal Councils of Kumhari and Balodabazar, and Municipalities of Chorarma, Lormi and Jarhi were present.        

Issues discussed included tax collections in naxal areas, more fund allocation under AMRUT to address issues of solid waste management, sewage treatment, water bodies rejuvenation, and several others. Funds were also sought for operation, and maintenance of built infrastructure under various schemes.

The Commission noted all the concerns highlighted by the representatives of the ULBs and promised to address them in its recommendations to the Central Government

Devolution to urban local bodies drives review of functions, finance and GST revenue impact for local governance. The Commission reviewed devolution of 12th Schedule functions and fiscal transfers to ULBs in Chhattisgarh, recorded State Finance Commission-based revenue sharing and prior central grant allocations, and sought reasons for functions not yet devolved. It examined the revenue consequences for ULBs from subsuming advertisement and entertainment taxes into the national indirect tax regime and asked whether compensatory mechanisms exist. ULB representatives requested additional funds for solid waste management, sewage treatment, water-body rejuvenation, operation and maintenance of infrastructure, and for service delivery in conflict-affected areas; the Commission said it would address these in its recommendations.