The Nashik Municipal Corporation (NMC), grappling with financial constraints amid rapid urban expansion and escalating development costs, has approached the state government seeking an increase in its Goods and Services Tax (GST) compensation grant. The civic body has urged that the annual hike be raised from 8% to 15%.
State Government Seeks Revenue Details
In response, the state government has asked the NMC to furnish detailed information about its revenue earnings from the earlier octroi and Local Body Tax (LBT) regimes, which were subsumed under GST in 2016–17. Currently, the NMC receives a monthly GST grant with an 8% annual increase. For the fiscal year 2025–26, the civic body received Rs 124.8 crore per month, amounting to a total of Rs 1,497 crore for the year. With the routine hike, the monthly grant is expected to rise to Rs 134.8 crore in 2026–27. However, the corporation has yet to receive the April and May instalments for the current financial year.
Insufficient Grant for Growing Demands
Officials have stated that the existing grant is insufficient to meet the city's growing infrastructure demands. "The revenue we receive through the GST grant from the state government every month is inadequate considering the rapid expansion of the city and the developmental works required. Nashik Municipal Corporation is already facing a financial crunch. The newly elected corporators have submitted various development proposals worth Rs 10,000 crore to the civic administration, but we could make a financial provision of only around Rs 100 crore, including ward development funds and corporators' funds, in the budget of the municipal corporation for the current financial year (2026-27)," said a senior NMC official.
Road Infrastructure Under Strain
The financial strain is particularly visible in road infrastructure. The city has a road network of approximately 2,500 km, including arterial and internal roads, of which 1,600 km are tar roads. "Tar roads are expected to be re-laid every three years, but around 70% of the roads have not been re-laid for over a decade due to a lack of funds," the official said. At present, the civic body is undertaking the development of 118 km of key roads linked to the upcoming Kumbh Mela at a cost of Rs 1,270 crore, funded through the Kumbh Mela Authority. Despite this, the backlog of maintenance remains significant. "We will need around Rs 1,000 crore to relay 70% of the roads in the city," the official added.
Demand for Adequate Grant
Reiterating the demand, the official said, "We need an adequate GST grant from the state government, and the annual increase should be at least 15%. We have requested the state government accordingly. It has sought details of the civic body's revenue from octroi and LBT over the past 15 years."
