Patna: To create a mechanism for developing internal resources of panchayats and reducing their dependence on the state govt, the state cabinet chaired by chief minister Samrat Choudhary on Wednesday approved a proposal to introduce new rules empowering panchayats to impose taxes, cess and fees on residents within their jurisdiction.The move comes after the Centre’s release of Finance Commission recommended funds to panchayats over the next five years. At a recent NITI Aayog meeting in Delhi, it was stipulated that state govts should undertake reforms to empower panchayats to generate their own internal resources by imposing taxes.As part of the suggested reforms, it was proposed that panchayats across the country levy annual user charges of Rs1,200 per user for piped drinking water supplied under the Har Ghar Nal Jal Yojana. Bihar panchayati raj minister Deepak Prakash and a few others had expressed reservations over the proposal.The new rules approved by the cabinet have been named the Gram Panchayat Tax, Cess and Fees Rules, 2026. Corresponding changes have also been made in relevant sections of the Bihar Panchayat Raj Act, 2006. Bihar has more than 8,000 panchayats and around 48,000 revenue and other villages.“The panchayats have been empowered to impose holding tax, taxes on commercial use of buildings, cinema theatres, advertisement and service tax (like on safe drinking water, village haats and bazaars), among several other items,” cabinet secretariat department additional chief secretary Arvind Kumar Choudhary said.He added that provisions had also been made regarding the process of tax collection, the authority responsible for collecting the taxes and the purposes for which the collected revenue could be utilised.Till now, no such rules relating to panchayat taxation existed, nor had any ordinance been issued to facilitate this. The panchayati raj department had therefore moved the proposal for amendments to the Bihar Panchayat Raj Act, 2006, and introduction of the new 2026 rules for cabinet approval.The cabinet also approved a proposal to augment the state’s internal resources by increasing taxes on motorcycles by 1%. Additionally, the tax on the purchase of three-wheelers has been increased by Rs1,000, while the trading tax has been increased four-fold.In the aviation sector, the cabinet approved the naming of the upcoming greenfield airport at Bhagalpur as Ajagaibinath Dham Greenfield Airport. It also sanctioned Rs1,329.58 crore for acquisition of 3,145.23 acres of land required for the project.The cabinet further approved signing of a memorandum of understanding (MoU) between the Airports Authority of India (AAI) and the state govt for preparation of pre-feasibility study reports for construction of three other greenfield airports at Rajgir, Rohtas district and Kaimur.Besides, the cabinet approved the release of Rs78 lakh as annual expenditure for the Bihar Aviation Institute to provide aviation training to concerned persons.The cabinet also gave its nod to a policy framed by the urban development and housing department regarding industrial and other uses of treated wastewater.Overall, the cabinet approved 31 proposals, including those related to tourism and the Home (Police) department, as well as five Bills that will be tabled during the upcoming five-day monsoon session of the state legislature for passage by the assembly.
