ABSTRACT
Local Bangladeshi governments depend substantially on the central government for financial supports to accomplish development activities. The NGO programme Sharique has endeavoured to make the local councils financially autonomous with the increased local collection, and formula-based fund receives from the national government with localities’ discretions. The outcomes reveal that both officials and citizens have been motivated to raise the tax rate and expand the tax base, diversify the sources of income by the officials, and to pay taxes, tolls, and so forth by the citizens. As a result, the councils collaborated with NGOs to increase the amount of revenue from taxes, lessen dependency on holding taxes by increasing non-holding tax collection, and improve non-tax revenue. However, local income generation still remains at a poor level as it covers only 4.7 percent of the total expenditure of the council on average. The growth rate of total annual income rose to 11.6 percent for councils involved in collaboration with Sharique project but stayed at 4.2 percent in councils outside of the project areas. These results exhibit better performance for the councils in Sharique areas. On the other hand, council discretion over money received from local sources and central government is yet to be achieved as there exists extensive control of national government, in addition to designated fund supply.
