Municipal finance refers to the revenue and expenditure decisions of municipal governments. It covers the sources of revenue that are used by municipal governments – taxes (property, income, sales, and excise taxes), user fees, and intergovernmental transfers. It includes ways of financing infrastructure through the use of operating revenues and borrowing as well as charges on developers and public-private partnerships. In certain markets, infrastructure is also financed through floating of Bonds backed by sovereign guarantees of the Governments.

In Pakistan in general, while in Sindh in particular, local revenue generation of municipalities is always inadequate to finance its budgetary expenditures and infrastructure development. Large dependence of municipalities has historically been on intergovernmental/provincial transfers.

The Directorate intends to carry out Municipal Finance Assessment Study for all District Head Quarter Towns of Sindh, in formation of 04 clusters i.e. North, South, Central, and Karachi.

The study would also attempt to identify key vulnerabilities and the most fundamental challenges currently faced by Sindh municipalities, and includes;

• Overall Situation Analysis of the Municipalities Revenues & Expenditures
• Trend Analysis and SWOT
• Present and Potential capacity of the existing infrastructure and resources of the Municipalities
• Present and Potential Revenues including Own Source Revenues of the Municipalities
• Detailed proposals and recommendations, after proper discussions with the stakeholders, for financial self-sufficiency and improved Service delivery of Municipalities.
• Recommendations identifying potential sources of Revenues, suggesting future trends.
• Detailed proposals/recommendations on enabling policy framework.
• Preparation of Asset Inventories (Secondary Data) of the Municipalities.