The State government devolves funds to the Local governments as 

Centrally sponsored schemes which are beneficiary-oriented are also implemented through local governments, and funds transferred to them for implementation. The Grama panchayats and Municipal Governments have been devolved significant powers to generate their own source revenue. Tax income is not raised at the Block or District level (hyperlink), although they may have other minor sources of own income (for example income from community assets). Devolution of Government grants  to local governments is as per a specific formula proposed by the SFC and approved by the State, except for the Central Finance Commission Grants, for which the pattern and norms of usage are determined by the respective Central Finance Commission awards. In 2023-24, the local governments have been devolved 27% of the State Plan (Rs 8258 cr). The annual allocation of funds to each LSG is indicated in Annexure IV of the State Budget.