The effectuation of the authorized purposes of authorities created under this chapter shall be for the benefit of the residents of municipalities, for the increase of their commerce and prosperity and for the improvement of their health, safety and living conditions. Since authorities will be performing essential governmental functions in effectuating these purposes, authorities shall not be required to pay taxes or assessments upon property acquired or used by them for such purposes. In lieu of such taxes or special assessments, an authority may agree to make payments to the city or the county or any political subdivision. The bonds issued by an authority, their transfer and the income from the bonds, including profits made on their sale, shall be free from taxation within this Commonwealth.