Kolkata | August 22, 2016: Union Power Minister Piyush Goyal on Monday suggested that the West Bengal government form a five-member committee to look at the high 25 per cent cess being imposed on coal by the state.

"The committee will do a profit-loss analysis of state's revenue as West Bengal government imposes 25 per cent cess on coal as against 14 per cent royalty levied by other coal-producing states," Goyal said after a meeting with the state's Power Minister Shobandeb Chattopadhyay and Advisor (Power) Manish Gupta.

Goyal said he believes West Bengal would be better off imposing 14 per cent royalty rather than the 25 per cent cess.

That would increase coal production as well as total revenue, and also foster ancillary industries and expand job opportunities, said the central minister who also holds the portfolios of Coal, New and Renewable Energy, and Mines.

The committee to be chaired by state power secretary and Coal India director (marketing) and director (finance) as members has been requested to submit a report in four weeks' time.

"Let the committee study and we will put our point of view on this subject," Chattopadhyay said.

Advisor (Power) Manish Gupta said: "Setting up a committee is a suggestion. But, we see this as a kind of encroachment into state's domain. The state coal cess revenue is linked to development like primary education and others. It will hurt our revenues."

Gupta also pointed out that the Centre had raised the coal cess by Rs 200 to Rs 400 per tonne recently. "In total, they raised the cess by 300 per cent in short period of time."

If the Centre is advocating reducing coal prices, it should reduce coal cess and freight cost of railway transportation instead of touching state's revenue, Gupta said.

The state imposes cess and royalty on coal. Earning from coal cess is Rs 700-900 crore a year while royalty charge is at about Rs 7 per tonne.

(Source: http://www.business-standard.com/)