Under the 1935 Act a good deal of injustice was done by the British government to the local bodies and I am glad that this limit of Rs. 50 has been raised to Rs. 250. I would have preferred that this limit had been graded and brought up to Rs. 2,500. That would have brought revenue to the local bodies from persons who can afford to pay and would have gone for the benefit of the needy and poor people. In October last year there was a conference called by the Health Ministry of all provincial Ministers of Local Self Government. They unanimously stated that the local bodies were suffering for want of funds and their finances should be improved if they are to do any good to the people. They appointed a Committee called the Local Finances Committee which met last month in Delhi and sent their interim recommendations to the Drafting Committee so that their case may not go by default. The Committee considers this limit of Rs. 250 as being very low and they would like to raise It to a thousand rupees per annum. I do not know what consideration was given to this recommendation. This was a unanimous decision of the Ministers of the provincial Governments but it is not considered at all, and the Drafting Committee imposes their own decision which will benefit no one. The U. P. Government also had a committee, called the Local Bodies Graft-in-Aid, Committee who also sent an interim report to the Drafting Committee in which they say: Clause (ii) mentions a special tax on trades and callings as compared with clause (iii) which is a general tax. In regard to the latter, the powers of our municipal boards were further curtailed by the Professions Tax Limitation Act, 1941, which provides that notwithstanding the provisions of any law for the time being in force, any taxes payable in respect of any one person to a province or any local authority by way of tax on professions, trades, callings or employments shall from and after April 1, 1942, cease to be levied to the extent to which such taxes exceed fifty rupees per annum. Thus its exclusion from the restrictions of the Professions Tax Limitation Act has been of little practical utility 128(1) (iii) of the Municipalities Act was really a profitable source of income, and therefore its limitation to a low maximum of Rs.50 per annum is not only objectionable in principle, as it violates against one of the chief canons of taxation requiring assessment on each individual in proportion to his ability to pay to ensure an equitable distribution between rich and poor, but has ‘also affected adversely the financial position of several municipalities.
