Electricity duty to increase up to 5% for commercial and industrial units, proposed by the Kerala State Finance Minister K N Balagopal while presenting state Budget 2023.
Electricity comes under Entry 38 of Concurrent list or List III of the seventh schedule of the Constitution of India. The Ministry of power on June 30, 2020 tweeted that “Electricity is a concurrent subject & responsibility of distribution rests with States. Govt. of India facilitates efforts of States to provide power to consumers in an improved manner”. Also stated to contact state authorities in case of issues related to faulty bills.
In the budget speech it was stated that presently electricity duty is collected and retained by Kerala State Electricity Board Limited (KSEBL), this process will cease by 31st October 2023. The amount thereafter shall be payable to Government account. This is expected to increase the revenue inflows to the Government.
Further stated that the electricity duty applicable for commercial and industrial units shall be increased and levied at the rate of 5%. It is expected to provide an additional revenue to the tune of Rs. 200 Cr to the Government.
Through these measures the government expects to control the financial crisis and also hopes to generate additional revenue for the 2023-24 fiscal year.
In the budget speech of 2021-22, the government exempted electricity charges for new industrial investments for the first five years.
The increase in electricity costs for commercial and industrial units has both positive and negative effects. The increase of industrial units is essential for economic development and GDP growth. The government has a responsibility to assist them by providing various fee exemptions as well as other subsidies.
From the viewpoint of the common citizen, the government did not burden them. The commercial and industrial units can afford the higher electricity costs as their usage increases. While it is hard to please every group of people when creating a budget, it is the responsibility of the government to do so.
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