Patna: The Legislative Assembly on Wednesday passed the Bihar electricity duty bill, 2018, which after becoming law will replace the Act of 1948 on the basis of which duty on electricity used to be levied in the state so far.

Electricity duty does not come under the ambit of the GST and states need to have their own rules for collecting the revenue. As far as revenue from this source is concerned, the state had got a revenue of Rs 225.53 crore through this route in 2016-17 whereas revenue collection till January 2018 in the fiscal year 2017-18 stood at Rs 174.29 crore.

Allaying concerns expressed by Opposition members during the debate on the bill, deputy chief minister Sushil Kumar Modi said the new act would not lead to imposition of any new tax on consumers and it had been necessitated due to the changes ushered in by the India Electricity Act, 2003, in the power sector.

The Bihar Electricity Duty Act, 1948, had been formulated keeping the provisions of the India Electricity Act, 1910.

"In the old act, the duty used to be levied at every step of power supply whereas the new act would allow imposition of duty only at the consumption level and thus simplifying the process of duty collection," Modi said while speaking on the need of coming up with the bill.

Sources in the state commercial taxes department revealed there used to be several disputes between power companies and the commercial taxes department over calculation of the electricity duty but the new act would end chances of such disputes in the future. The new act also talks of dividing the consumers in several categories such as residential, commercial, industrial, temporary, agriculture, advertisement, mono and Metro rail.