By The Hindu Bureau
Copyright thehindu
The Karnataka government approved an initial grant of ₹125 crore for the five new city corporations created by dividing the Bruhat Bengaluru Mahanagara Palike (BBMP). Each corporation under the Greater Bengaluru Authority (GBA) will receive ₹25 crore to manage regular administrative and operational expenses until a system is put in place for direct tax payments into their own accounts.
The new corporations have been established under the Greater Bengaluru Administration Act, 2024 through a government notification issued on September 2, 2025. They are Central Corporation, East Corporation, West Corporation, North Corporation and South Corporation. With this restructuring, BBMP has ceased to exist. All its assets, liabilities, officers and staff have been transferred to the GBA, which will now oversee the five corporations, along with Bengaluru Solid Waste Management Limited (BSWML) and Bengaluru Smart Infrastructure Limited (B-SMILE).
Interim measure
For the financial year 2025-26, BBMP’s property tax collection of about ₹300 crore has been kept in the account of Union Bank. From this reserve, ₹25 crore each is being released to the five corporations as an interim measure. The corporations have already opened their individual bank accounts, but until tax revenues start flowing directly, the government of Karnataka will release funds from the BBMP’s account.
In future, when the remaining BBMP grants are distributed among the corporations, the government may adjust this advance amount, the order stated.
The government has made it clear that the grant must be spent only as per rules and with the approval of the respective administrative officers. It also stated that these grants will be adjusted during future distribution of BBMP funds, and that expenditure should comply with the Karnataka Economic Code, 1958 and all other existing financial laws.
The order was passed under various sections of the Greater Bengaluru Administration Act, 2024. These sections allow the government to take over all assets and liabilities of BBMP and other local authorities when the final notification is issued. It also allows the government to temporarily manage these assets and make financial arrangements until the new corporations are fully functional.
