Article 243X

Taxation Powers, State Grants, and Municipal Funds

Official heading: “Power to impose taxes by, and Funds of, the Municipalities”

Check this article against the official editionAwaiting human legal review

Source edition: The Constitution of India (as on 1 May 2026)
Source locator: Part IXA, Article 243X, printed pages 133–134
Last human source-link check: Not yet checked
Last human legal review: Not yet reviewed

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1. In One Sentence

Empowers State Legislatures to authorize Municipalities to levy property taxes, tolls, and user fees, and receive state grants-in-aid.

2. What It Means in Everyday Language

Article 243X provides the financial lifeblood for urban local bodies.

It empowers State Legislatures to authorize Municipalities to levy and collect taxes (such as property tax, advertisement tax, and entertainment tax) and user charges.

It also provides for the assignment of state taxes to Municipalities, grants-in-aid from the State Consolidated Fund, and the creation of municipal funds.

3. Practical Illustrative Example

Everyday Scenario:

A homeowner pays annual municipal property tax and water supply connection fees to the City Corporation.

Core takeaway: Under Article 243X, municipal revenue collection is constitutionally sanctioned to fund local urban infrastructure and sanitation.

Illustrative Notice: Municipalities cannot introduce new taxes without specific statutory empowerment enacted by the State Legislature.

4. Important Limits, Qualifications & Exceptions

Article 243X establishes the fiscal capacity of urban local governments.

Property & local taxes: Authorized under state statutory procedures.
State grants: Regular grants-in-aid support capital infrastructure projects.
Municipal Fund integrity: Regulates deposit, accounting, and withdrawal procedures.

5. Operative Constitutional Text

The Legislature of a State may, by law,— (a) authorise a Municipality to levy, collect and appropriate such taxes, duties, tolls and fees in accordance with such procedure and subject to such limits; (b) assign to a Municipality such taxes, duties, tolls and fees levied and collected by the State Government for such purposes and subject to such conditions and limits; (c) provide for making such grants-in-aid to the Municipalities from the Consolidated Fund of the State; and (d) provide for constitution of such Funds for crediting all moneys received, respectively, by or on behalf of the Municipalities and also for the withdrawal of such moneys therefrom, as may be specified in the law.

Transcription for reference; compare with the linked official editionNot yet verified by a human legal reviewer

6. Sources & Historical Assembly Deliberations

Assembly quotations are withheld until wording, dates, and attribution have been checked against the primary record.

Sources & Citation Metadata

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Constitutional TextThe Constitution of India (as on 1 May 2026)Cited PDF page
Government of India (Legislative Department, Ministry of Law and Justice) • Part IXA, Article 243X, printed pages 133–134 • Human source-link check pending
Primary PDF accessed and transcribed with AI assistance on 14 October 2026. Formatting and amendment annotation markers are omitted; operative wording is retained. This is not human legal review. Later amendments and commencement notifications have not been comprehensively checked.

Human legal review is pending; compare the text with the cited editionNon-partisan educational resource