Frequently Asked Questions on Panchayat Taxation System

Q1. Explain in brief about Taxation in Panchayat.

Ans: The second Administrative System Reforms Commission of India (2005 – 2009) has summarized the sources of revenue for the panchayat in that internal resource generation – taxation being one of them. A Gram Panchayat may appoint a tax collector to collect tax quarterly, half-yearly, or in advance as decided by the particular Gram Panchayat. The Tax Collector shall issue receipts in the prescribed forms of all types of collections and he shall also enter all collections in the daily collection register of the Gram Panchayat.

Q2. Which of the Article in the Constitution of India mentions a Panchayat Taxation System?

Ans: According to Article 243(H), the Panchayats have the power to levy, collect and appropriate taxes, duties, tolls, and fees by the such procedure of the State Legislature and enable them to make such grants in aid to the Panchayats from the consolidated fund of the state.

Q3. What exemptions are available for advertisement tax in Panchayat?

Ans: No tax shall be levied under this section on any advertisement or notice :

• of a public meeting
• Of election to any Legislative Assembly or Gram Panchayat or Mandal Parishad or Zilla Parishad.
• Any advertisement that is not in the sky sign is exhibited within the window of any building.
• Any sale or entertainment or meeting held on the same land or building relating to trade or business carried on within the land or building.
• Relates to the Business of any railway administration.

Q4. Explain in brief about House Tax levied by Panchayat.

Ans: A house tax is levied on all houses in the village on either the annual rental value or the capital value. It shall be levied at such rates as may be fixed by Gram Panchayat not being less than the minimum rates and not exceeding maximum rates prescribed regarding the basis of levy adopted by the gram panchayat. the house tax will be levied every year and shall be paid by the owner within thirty days of the commencement of the year.

Q5. Explain in brief about the Water Tax levied by Panchayat.

Ans: The tax depends upon Where the supply of drinking water by Panchayat is determined according to the cost of supply and maintenance of Water supply schemes. And the tax may vary depending on the diameter of the pipe that supplies water to households. There is a separate water tax levied by the Gram Panchayat for the supply of water for the construction of new houses and buildings. Gram Panchayat may collect certain taxes for the supply of water from tanks and wells for the following purposes :

• Making of bricks and tiles.
• Washing of clothes by washer man.
• For industrial or commercial use.
• For purpose of irrigation.

In India, the term Panchayat refers to a system of rural self-government. It was established in all states of India by acts of state legislatures to build democracy at the grassroots level. It was constitutionalized by the 73rd Constitution Amendment Act of 1992. The second Administrative System Reforms Commission of India (2005 – 2009) has summarized the sources of revenue for the panchayat in that internal resource generation – taxation being one of them. A Gram Panchayat may appoint a tax collector to collect tax quarterly, half-yearly, or in advance as decided by the particular Gram Panchayat. The Tax Collector shall issue receipts in the prescribed forms of all types of collections and he shall also enter all collections in the daily collection register of the Gram Panchayat. According to Article 243(H), the Panchayats have the power to levy, collect and appropriate taxes, duties, tolls, and fees by such procedure of the State Legislature and enable them to make such grants in aid to the Panchayats from the consolidated fund of the state.