States have no say on taxing power: Centre
Says no State has power to impose any tax or duty on electricity generated from any source - coal, hydro, wind or solar and any such levy is illegal and unconstitutional
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What’s Rationality?
♦ Because electricity generated within the territory of one State may be consumed in other States
♦ And no State has the power to levy taxes/duties on residents of other states
New Delhi: The central government has asked States that they have no power to impose any tax or duty on electricity generated from any source - coal, hydro, wind or solar and any such levy is illegal and unconstitutional.
In a circular recently, the Union Ministry of Power said it had come to the notice of the central government that some state governments had imposed additional charges on generation of electricity from various sources under the guise of development free/charges/fund. “Such additional charges/fees in the form of any tax/duty on generation of electricity, which encopasses all types of generation viz thermal, hydro, wind, solar, nuclear, etc., is illegal and unconstitutional,” it said. Clarifying on the constitutional position, the ministry said the powers to levy taxes/duties are specifically stated in the VII Schedule.
