Political Slugfest Over Gram Panchayats' Power to Levy, Collect Local Taxes

Patna, July 16: A verbal duel has erupted between the NDA and the opposition a day after the Bihar Cabinet authorised Gram Panchayats to independently levy and collect local taxes, rates and user fees to increase rural self-reliance.

Condemning the state government's decision, state RJD spokesperson Arun Kumar Yadav alleged that the approval of the Gram Panchayat Tax and Fee Rules, 2026, under which a holding tax ranging from Rs 50 to Rs 5,000 would be levied in rural areas, was unjust.

He alleged that the people of Bihar were already struggling with inflation, unemployment, corruption, poverty and rising crime. He said that by placing an additional tax burden on poor villagers, farmers, labourers and middle-class families, the NDA government was pursuing an unjust and anti-people policy.

Opposition Demands Withdrawal

The RJD spokesperson asked the government to withdraw the "anti-people decision" immediately. Instead of imposing additional financial burdens on rural residents, the government should focus on providing them with better basic infrastructure and public services, he contended.

CPI(ML) MLA Sandeep Saurav alleged that the government was busy sucking the public dry.

“If you sell something from a small roadside stall, there will be a tax. If you sell crops from your field in the market, there will still be a tax. The government is engaged in looting the public to fill Adani's coffers," he claimed.

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NDA Defends Tax Proposal

Bihar Food and Consumer Protection Minister and senior JD(U) leader Ashok Choudhary, hitting back at the opposition, claimed that it had no other work to do. He asked how development work would be carried out if the tax was not imposed.

Under the draft "Gram Panchayat Taxes, Rates and Fees Rules, 2026", village panchayats across the state can now collect revenue directly.

According to the proposal, Gram Panchayats can develop their own resources to generate revenue and will be able to collect taxes and fees on holdings (properties), professions, businesses, markets (haats) and industries within their jurisdiction.

The government contends that this will reduce the panchayats' dependence on it.