New Delhi: Despite efforts to give rural local bodies more financial autonomy, Own Source Revenue (OSR) generation for panchayats across India remains low, with an average of just ₹59 per capita between 2017 and 2022. According to data from the Panchayati Raj ministry, the total OSR raised by panchayats during this period amounted to ₹5,118.98 crore, equating to ₹2.27 lakh per panchayat for the 2.25 lakh gram panchayats across the country, serving a population of over 86.95 crore.
Among the states, Kerala ranks second in total OSR collection, raising ₹802.95 crore. Gujarat led with ₹829.75 crore, followed by Andhra Pradesh with ₹791.93 crore. In terms of per capita OSR, Goa topped the list with ₹1,635 per person, while Puducherry raised ₹757 per capita.
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The OSR figures highlight the challenges faced by panchayats in raising their own revenue, despite grants from the central and state governments. At a recent conclave organized by the Panchayati Raj ministry, experts discussed ways to strengthen panchayats’ financial independence, including tax-based OSR models. However, many states, such as Arunachal Pradesh, Bihar, and Uttar Pradesh, have yet to implement OSR rules, which further limits their ability to generate local revenue.
The government has also encouraged panchayats to raise funds through mechanisms like property tax assessments using the SVAMITVA data, as well as sharing royalties from local mining and GST revenues.
While the total allocation for rural bodies under the 15th Finance Commission is ₹2.36 lakh crore for 2021-2026, with 60% allocated for specific projects, the lack of OSR remains a significant challenge for panchayats seeking greater financial independence. PTI
