ABSTRACT
The mismatch between state-local revenue needs and revenue sources was partially alleviated by unilateral action on the part of the federal government. Revenue sharing cannot provide the stimulus to particular programmes obtained by the conditional grant approach. Conversely, the existence of a conditional grant programme will not provide the fiscal support needed to finance the portion of other state-local services that people at the lower end of the income scale cannot support out of their meagre incomes. It is important to stress that equalisation is the major objective of revenue sharing. Revenue sharing is not a panacea for all the fiscal problems of the state and local governments. It is a constructive piece of legislation which will provide needed revenues for public services in some places and moderate the growth of undesirable state-local taxes in others.
