MoP asks states to withdraw any tax/duty on generation of electricity

The MoP has declared any tax/duty on generation of electricity, which encompasses all types of generation – thermal, hydro, wind, solar, nuclear, etc. as illegal and unconstitutional. It has been stated that any imposition of tax on the non-consumptive use of water of the rivers for electricity generation is in violation of provisions of the Constitution of lndia. Therefore, the ministry finds no rationale for levy of water cess or air cess. The ministry has further directed that no taxes/duties may be levied by any state under any guise on generation of electricity and if any taxes/duties have been levied so far then it must be promptly withdrawn.