Modi promises to plug holes in Bihar tax laws

Tax reform and investment in infrastructure are high on the agenda of the National Democratic Front (NDA) government in Bihar," said Deputy Chief Minister Sushil Kumar Modi. Modi also holds the finance portfolio.

Speaking to the Business Standard on the sidelines of the BJP national convention here, Modi said, "There are many anomalies in tax laws of the state. There is a lot of scope to improve tax administration and plug the gaps." Some major announcements on this front would be made on January 3, He said.

Referring to a meeting of traders and industrialists earlier this month, Modi said because of the anomalies in the laws, officers had too much discretionary powers leading to corruption.

"We have decided to cut discretionary powers, restructure sales tax and other tax rates and bring transparency in tax administration," he said.

Saying only 30 Mw electricity were being generated against a peak demand of 1100 Mw, the deputy chief minister said to improve the situation, Bihar had entered into an agreement with National Thermal Power Corporation (NTPC). NTPC will be given two redundant thermal power plants with a combined capacity of 800 Mw.

"We expect that power generation in these plants will begin in January 2007," Modi said.

Modi said Bihar had tremendous hydro-electricity potential and the state government was working out a plan to tap that.

"All road projects including work on the east-west corridor have come to a halt because of the poor law and order situation. But work will start on these projects soon. Contractors and workers involved with these projects will be given protection by central para-military forces and the state police," Modi said.

On agro-based industries, he said the sugar sector had tremendous potential. "Our first priority is to revive the 25 closed sugar mills and start new ones," Modi said.