Question

Tax incremental financing in Hyderabad model is to pay for

• A. Urban Infrastructure such as Storm water drains, parks and roads
• B. Education
• C. Land
• D. Institutions

Hint:

Tax Incremental Financing is an effective way to fund urban infrastructure improvements by using the future increase in tax revenue generated by those improvements.

Answer 1

The Correct Option is A

Tax Incremental Financing (TIF) is a financing method used to fund infrastructure development. In the Hyderabad model, it is primarily used for urban infrastructure projects, such as storm water drains, roads, and parks, by leveraging the future increase in property taxes generated by these infrastructure improvements.
The future property tax revenue resulting from the enhanced infrastructure is used to repay the investment made in the development of these facilities. This approach helps to raise funds without relying on immediate government budgets.
TIF is not typically used for funding education, land acquisition, or institutions, making option (A) the correct answer.