i have built a few new cities, but dont see any increase in tax returns is it because they need to populate or what.
Cities and castles are fully formed and identical to all other cities and castles when completed, which takes two years (?). The only form of building up they do is what gets built in them.
If you kept the cities, they'll be in your tax tab on the right, middle of the screen (I keep that open permanently). Keeping new cities is the default, you're the title holder until you give it away. The tax receipt number will be in red because it's a wrong holding type. It is still worth keeping a city if it is in your capitol, you have the steward collecting taxes, and you're below the demesne limit. Otherwise the -75% wrong holding penalty is too much to justify keeping it. Even if it's in your capitol, do the math and check your realm laws on Burgher taxes. I could be wrong.
If you've given it to a mayor, then the taxes you receive are a % based on realm laws, hurt by the amount the mayor dislikes you if he dislikes you (-30 is -30% taxes). Even then, you only get the $ if the city is in a county which you control directly. If you build a city in a county owned by a vassal or a vassal of a vassal, well, then your Realm is stronger and richer, but you yourself don't get money directly, I believe. You
might get some money, if you have Noble taxes and if (as I assume) Noble taxes include the income your vassal gets from the taxes he gets from cities. But it's never gonna repay to you the 700 you spent. You made your realm better, but you personally won't benefit all that much.
Which is why I build in my capitol county and one or two which I fight like hell to keep for each successive ruler. Also, I stopped building cities. Castles provide decent income themselves - no wrong holding penalty ftw - and over the long haul I want stacks of men when crunch time comes, rather than income. Keep a stockpile of gold from all your holdings for when there is trouble. Income will let you hold on a bit longer, but won't save you when there's a major succession revolt. Only a hoard of gold will do that. On the other hand, your personal levy will always be yours in good times and in bad. Look at the military screen, 5k on the top is as good as 20k on the bottom, because a revolt cuts the 20k in half (or worse) because half those men are attacking you, and the remaining 10k gets cut in half (or worse) because the rest of the realm doesn't love you or there wouldn't be a succession crisis. Castles are also much better defensive holdings, the enemy can take forever besieging a County with four castles holding a garrison >1000, and if they assault, just laugh out loud. Sorry to go off on a tangent.