Local Financial Procedures

228. No tax to be levied or loan to be raised: (1) No tax shall be levied and collected

and no loan raised in the Local level except in accordance with law.

(2) The Local level may levy tax by law on matters falling within its

domain without prejudice to national economic policies, carriage of goods and

services, capital and labour market, and the neighbouring State or Local level.

229. Local Consolidated Fund: (1) Each Village Body and Municipality under the

Local Level shall have one Local Consolidate Fund. All revenues received by the

Village Body or Municipality, any amounts of grants received from the

Government of Nepal and the State Government, all loans raised by the Village

Body and Municipality, and amounts received from other sources shall be credited

to such a Fund.

(2) Matters relating to expenditures from the Local Consolidated Fund

under clause (1) shall be as provided for in the Local law.

230. Estimates of revenues and expenditures of Village Body and Municipality: (1)

The Village Executive and the Municipal Executive shall, subject to this

Constitution, lay an estimate of revenues and expenditures of every financial year

before, and have the estimate passed by, the Village Assembly and the Municipal

Assembly, respectively, as provided for in the Local law.

(2) If, in laying an estimate of revenues and expenditures under clause

(1), the Village Executive or Municipal Executive is required to make a deficit

budget, it must purpose also the sources to meet the deficit as provided for in the

Federal law and the State law.