Abstract and Figures This paper examines trends in local government revenues and current challenges that local governments face in raising revenue. >> >> Since development demands a lot of capital, this study will critically analyze the relationship between local government finance system i.e. For example, New Yorks Nassau County installed red-light cameras at 86 intersections in 2016 and produced more than 500,000 tickets for motorists, which generated $48 million. /Resources << sources, via the external sources and the internal source. State and Local Finance Data: Exploring the Census of Governments, How the COVID-19 Pandemic is Transforming State Budgets, State Tax and Economic Review /Type /Group 2. /F7 42 0 R When renegotiating existing leases, several levers can be utilized, such as increasing allowable floor-to-area ratio (FAR), collecting penalties for violations, amending contract duration and payment terms, and modifying plot use. (2014). On the other hand, if the state collects a tax imposed by local governments, the collection and distribution to the imposing local governments is treated as an agency transaction; that is, the receipts are reported entirely as tax revenue of the local governments and not as either a state tax or state intergovernmental expenditure. /Meta39 39 0 R >> City of Los Angeles Department of Public Works, Bureau of Engineering standard fee list, July 1, 2018, eng2.lacity.org. Cities could also increase value from unused land plots through monetizing them either as lease contracts or through other more innovative publicprivate partnership structures, such as joint development agreements or joint ventures (Exhibit 4). /Font << << out of variations from the revenue generation capacities of component units. 0000002251 00000 n How does the current system of international taxation work? What are defined contribution retirement plans? Something went wrong. /Type /Page Tracy Gordon, Richard C. Auxier, and John Iselin (2016), Governing with Tight Budgets; Long Term Trends in State Finances How accurate are long-run budget projections? /Type /Pages Gross Domestic Product, Third Quarter 2018 (Second Estimate); Corporate Profits, Third Quarter 2018 (Preliminary Estimate).. >> /F7 42 0 R /F2 21 0 R x]s63|:oNg$8Sw}hKM7?.~Vb@g6v|Y,j]w2_~yv6IDltsLDI%:nCSq251Le,qGO2-y5E 6X6> iq#"K%J3#GfF/_F ?V]pq^Te%&zuD`~>EgFY3c87Hlt9@)Ov?"c" @]TLlJaZg=40P//^E5uTxR4nhs7=pOCezQ&6.6+`,^M:|"T|m|'wo'Sc^e~abN77`& 8E9"m @}_6l?\Lzw]$1%gVv!CBJi`UY! Its time to change it, CityMetric, March 12, 2018, citymetric.com. For example, the federal government sends K-12 education funds to state governments that then distribute the money to local governments. What are the sources of revenue for local governments? % By 2050, 68 percent of the global population will live in urban areas. endstream Taxes accounted for 42 percent of local general revenue in 2017. It is therefore suggested that the level of economic dependence on coal widely varies, and some, but not all, local governments will require financial assistance after the coal phase-out. /Contents 62 0 R Today, the LGDF receives only 6.06% of total personal income tax the state receives, a reduction . endobj This charge generates more than $100 million in revenue each year. Department of Political Science and Public Administration, PMB 4010, Babcock University, Ilishan-Remo, Ogun, Nigeria, You can also search for this author in How would various proposals affect incentives for charitable giving? /Contents 29 0 R This is a preview of subscription content, access via your institution. endobj /Image8 18 0 R These three dimensions can be further broken down into factors for evaluation (Exhibit 5). What are error rates for refundable credits and what causes them? /CS /DeviceRGB How might the taxation of capital gains be improved? /StructParents 5 Fix the home. How does the tax system affect US competitiveness? Each time, the city brought in $7 million to $9 million in revenue. 3 0 obj >> << %PDF-1.4 % Tax is however, a compulsory levy imposed by government on individuals and companies for various legitimate functions of the state (Olaoye, 2008). %PDF-1.4 In our experience, governments can capture significant valueup to 50 percent of potential additional revenuesby implementing measures linked to effectiveness such as enhancing collections and audit processes or better asset monetization. Financing Local Governments: Exploiting the potential of local revenue Introduction Local governments are constitutionally empowered to control, regulate and also raise revenues from activities in their jurisdiction. Professional Import Duties Administrators These activities, such as hospitality charges and taxes on plastic bottles and bags, carbon from vehicles, and vacant land, do not involve the delivery of services from the government. % What are the sources of revenue for local governments? endstream Governments, with input from citizens, must decide how to manage risks 5. Hence the various sources of local government finance have become very crucial in order to foster development at all levels of governance. /Group << On what do economists agree and disagree about the effects of taxes on economic growth? /F6 25 0 R /Type /Group How do IRS audits affect low-income families? As a local government leader, you're pressed to keep up with the immediate needs of your community during the COVID-19 crisis. Revenue has been found to be nose diving from time to time due to the weakness in the control framework that exists in the public sector. How did the TCJA affect incentives for charitable giving? /CS /DeviceRGB Taxes provided 49 percent of state general revenues in 2019, including: Charges, such as tuition paid to a state university, payments to a public hospital, and tolls on highways, when combined, provided another 11 percent of state general revenues in 2019. endobj For example, the federal government sends K-12 education funds to state governments that then distribute the money to local governments. We have found that this effort has led to a year-over-year increase in municipal revenues of 30 percent. How did the TCJA change the standard deduction and itemized deductions? 14 0 obj Next, cities should perform a thorough gap analysis to define the potential revenue impact for any given stream. It is very important especially for developing countries because in developing . << startxref A new tax on plastic would raise revenues and also benefit the environment. %PDF-1.4 This gave a substantial and unprecedented reform of autonomy to the, devolved on the local government therefore, became a common $no#ledge that, most of the local government are finding it difficult to cope #ith the present level, The principal aims of creating local governments #ere as, /. How large are individual income tax incentives for charitable giving? 971z Based on option B; 72 respondents (38.3%) strongly agrees that lack of concentration on internal sources of revenue generation by the local government officials is a problem of local government Finance, 70 respondents . What is the TCJA repatriation tax and how does it work? In contrast, revenues from charges steadily increased from 11 percent of general revenuein 1977 to 17 percent in 2019. This intervention includes expanding the sheer quantity of service offerings and assets, extending charges to a larger user base, or increasing the frequency of surveillance and inspection for selected fine sources to maximize detection of violations. Revenue generation is the main source of income to the Federal, State and local Governments. Fines. /MediaBox [0 0 595.32 842.04] /Image87 74 0 R >> /ProcSet [/PDF /Text /ImageB /ImageC /ImageI] 7 Other strategies, such as payment plans, can also reduce leakage and increase collections. Contemporary issues in local government administration in Nigeria. /Image93 73 0 R <>stream /Meta37 37 0 R >> What is the tax treatment of college and university endowments? /XObject << In the last 10 years, Illinois has reduced the portion of income tax returned to cities and towns. 2.1.3 Sections 31 and 32 of the Local Government Financial and Accounting Regulations 2007 What are inversions, and how will TCJA affect them? /Font << Before the crisis, long-term structural deficits were persistent for both individual governments and the entire sector as spending plans and patterns outpaced governments' revenue-generating capacity. Revenue generation is the main source of income to the Federal, State and local Governments. xZs8hI6mzumvwn:ul7 z?0{v8,Vjq.W?_/NOfSXbyqhu0r}z2/6r>YmM%`@NUOv- /CS /DeviceRGB Once cities have identified their field of options, they must consider several questions before jumping into implementation: Which streams and interventions can generate the most revenues with a limited impact on stakeholders? 5 /Image73 63 0 R In 2020 and 2021, Congress transferred a large amount of funds to local governments as part of the CARES Act . Fajobi, O. F. (2010). /StructParents 9 /Font << 0000003592 00000 n In Saudi Arabia, the Ministry of Municipal and Rural Affairs has a control unit that monitors the performance of regions and the regional government authorities that oversee municipalities. 5356 0 obj <> endobj Candice Ferrette and Robert Brodsky, Red-light camera revenues jump in Nassau County, Newsday, June 10, 2018, newsday.com. If you would like information about this content we will be happy to work with you. /XObject << >> What tax incentives exist for higher education? /Parent 2 0 R /Type /Page /F2 21 0 R Hassan, M. M. (2011). /GS7 17 0 R Recent Comprehensive Tax Reform Proposals, The State of State (and Local) Tax Policy, Fiscal Federalism and Fiscal Institutions. Part of Springer Nature. A simulation of 8,760 h year-round was performed for the provincial market containing the integrated generation plant without energy storage. Cities should then establish a revenue committee that adopts a strategic perspective to assess the impact of revenue levers and understand the interlocking factors. Prior to the 2011 state income tax increase local governments received a 10.0% share of the income tax revenue. There is no one route that cities can or should take to boost revenues. What kinds of tax-favored retirement arrangements are there? %%EOF /Meta78 65 0 R /Meta37 37 0 R /Image8 18 0 R /Meta99 77 0 R Candice Ferrette and Robert Brodsky, Red-light camera revenues jump in Nassau County,. >> Keywords: Local Government, Federalism, Revenue Allocation and Fiscal Federalism 1. Eneanya, A. N. (2012). 6. /Image8 18 0 R Performance meetings should be scheduled on a weekly basis to track revenue generation and build ownership. /Parent 2 0 R /Tabs /S /Group << International Journal of Arts and Humanities Bahir Dar, Ethiopia, 2(3), S/No. /ExtGState << /Meta53 50 0 R - 185.64.219.103. /CS /DeviceRGB general sales taxes and gross receipts taxes, Coronavirus Response and Relief Supplemental Appropriations Act, federal funds for local transportation projects, Surveying State Leaders on the State of State Taxes, More Than Fines and Fees: Incorporating Equity into City Revenue Strategies, State and Local Government Revenues and Racial Disparities, Assessing Fiscal Capacities of States: A Representative Revenue SystemRepresentative Expenditure System Approach, Fiscal Year 2012, Governing with Tight Budgets; Long Term Trends in State Finances, Center on Labor, Human Services, and Population, Metropolitan Housing and Communities Policy Center, 8 percent from selective sales taxes on purchases such as, 2 percent from selective sales taxes on purchases such as, 3 percent from other taxes such as a locality'staxes onhotel bookingsandrestaurant meals. <>stream The revenue systems of these governments eroded while the workloads and scope on the expenditure side of the state and local system budget . /Meta40 35 0 R /S /Transparency << Of course, feasibility depends in part on the impact of an action on the city and its residents. /F3 84 0 R >> Another 6percent of localgeneral revenue came from miscellaneous sources such as amounts received from the sale of property and interest from some investment securities. 14 0 obj Would tax evasion and avoidance be a significant problem for a national retail sales tax? What are Opportunity Zones and how do they work? 7, 192209. Olaoye, C. O., Taiwo, O. Do all people eligible for the EITC participate? 9 0 obj The involvement of leadership as well as all relevant departments and municipalities would help to ensure proper implementation across all levels. %(zC]N"t~'ewd+*a[`.dP(wz)Vio+qjXvVmWHS%n}"GC3m*.#w+.T#p1f^HgC`|Mzcs,JX8/v>na,4t^}$$\X S:ds0{ws:yGu.%;x/\)F@!>od1v((EF|' Loay AlMujadidi is a consultant in McKinseys Riyadh office; Christian Azoury is an associate partner in the Dubai office, where Dirk Schmautzer is a partner; and Jonathan Woetzel is a senior partner in the Shanghai office and a director of the McKinsey Global Institute. /F5 40 0 R appropriate. /Parent 2 0 R How did the TCJA affect the federal budget outlook? It should also prepare reports on the performance of various initiatives and their respective owners or entities and update revenues studies based on changing market conditions. 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