Just as the federal and state governments collect revenue, so too do local governments, in the form of taxes and fees to fund various services, like schools, sewers, garbage collection and water. Taxes might be imposed on property, purchases (sales tax) and sometimes on income. Fees might be imposed, among other things, on the user of a service or to offset a cost or burden.
Look to a state's constitution and and statutory code for guidance on what powers are conferred -- or not, as the case may be -- to the local governments to tax. Code sections, for example, might be titled something like "Local Power to Tax".
Taxes vs. fees
The distinction between taxes and fees is not always clear. For more on the subject, including the Supreme Court's perspective, see:
Check out some of these texts or websites to assist with your local tax research:
Local Government Law (Ch. 23 - Taxation) -- Available on Westlaw Next
McQuillin: The Law of Municipal Corporations (Ch. 44 - Taxation) -- Available on Westlaw Next
Refer to the Secondary Sources page in this guide for additional recommendations.