Sorry, I would delete this post if I knew how... it looks propoganda just adds to "city income", and the actual gold coming to you depends on the tax rate.
Really useless spell then, IMO. Meditation is worth 2 - 6 mana for free while propoganda is only worth a couple gildar at most at the cost of 20 mana (+ upkeep, if there is one, I forget)
Another gold bug:
I cast propoganda on a 3 essence town and it wasn't giving any gold bonus. Enchantment icon appears, but gold bonus doesn't show up in city detail summary, or income tab.
I cancelled the enchantment and didn't change my actual income either... so it's not just a display issue.