Himachal steps up toll, entry fee reforms to boost revenue post-RDG; Dy CM Mukesh Agnihotri urges PM's support

Shimla (Himachal Pradesh) [India], February 19 (ANI): Facing mounting fiscal pressure after the discontinuation of the Revenue Deficit Grant (RDG) recommended by the 16th Finance Commission, the Himachal Pradesh government has stepped up internal resource mobilisation through reforms in excise, liquor vends, toll collection and revised entry fee structures for vehicles entering the state.
The Department of State Taxes and Excise has notified the Toll Policy 2026-27 for the financial year April 1 to March 31, 2027, under which toll barriers will be leased through a transparent e-auction mechanism with fixed reserve prices.
The policy mandates electronic toll collection, CCTV monitoring and phased FASTag implementation to curb leakages and improve compliance while ensuring steady monthly remittances to the state exchequer.
Alongside toll reforms, the government is strengthening excise collections, a key component of the state's own tax revenue.
The excise framework for 2026-27 continues auction-based allotment of liquor vends with rationalised reserve prices linked to past revenue performance and consumption patterns. Digital monitoring of stock movement, stricter enforcement and transparent bidding are expected to push higher licence fees, excise duty and VAT collections.
In a related move to augment non-tax revenue, the state has also increased entry fees for vehicles arriving from outside Himachal Pradesh. The revised rates, effective from April 1, 2026, raise charges across most categories and are expected to impact tourism, transport and freight costs.
As per the revised structure, the entry fee for private cars, jeeps, vans and light motor vehicles has been increased from Rs 70 to Rs 100, while 12+1 seater passenger vehicles will now pay Rs 130 instead of Rs 110. The fee for mini buses (32 seater) has nearly doubled from Rs 180 to Rs 320, and commercial buses will pay Rs 600 against the earlier Rs 320.
Charges for construction machinery have risen from Rs 570 to Rs 800, heavy goods vehicles from Rs 720 to Rs 900, and tractor or double-axle bus-truck categories from Rs 70 to Rs 100, while one machinery category remains unchanged at Rs 570.
The revised entry fee will be collected at designated toll barriers, with contractors required to install FASTag-enabled systems and related infrastructure within 15 days of allotment. The government maintains that technology-driven collection will reduce congestion, improve commuter convenience and prevent revenue leakage.
Officials said excise earnings from liquor vends, combined with toll receipts, entry fee collections, mining revenue, transport taxes and power sector income, form the backbone of Himachal Pradesh's limited revenue base, making these reforms critical in the post-RDG fiscal landscape.
Speaking to ANI here, Deputy Chief Minister Mukesh Agnihotri said the government is focusing on transparent systems to strengthen its finances.
"The state is generating its taxes through transparent methods. We have opted for reforms in excise, tolls and other sectors to ensure accountability and improve revenue collection," he said.
Urging central assistance, Agnihotri appealed to Prime Minister Narendra Modi to consider the fiscal challenges faced by hill states. "We appeal to the Prime Minister to consider the special circumstances of hill states like Himachal Pradesh and ensure support from the Consolidated Fund of India," he said.
Highlighting the state's financial structure, the Deputy Chief Minister noted that Himachal Pradesh has a limited tax base of around Rs 18,000 crore, borrowing capacity of nearly Rs 10,000 crore and receives about Rs 14,000 crore as its share of central taxes.
"Our income sources are limited excise, mining revenues of Rs 300-350 crore, transport and power projects. With GST compensation already gone and RDG now discontinued, the state faces financial stress," he added.
Agnihotri also targeted the previous government led by former Chief Minister Jai Ram Thakur, alleging that significant debt and financial liabilities were inherited, further tightening fiscal space.
Tourism stakeholders have expressed concern over the entry fee hike, saying higher travel costs could affect visitor inflow and local businesses, though the government maintains that improved infrastructure and transparent systems will offset the impact.
With RDG withdrawal reshaping the fiscal landscape, the state's strategy of transparent auction of liquor vends, technology-driven toll and entry fee collection and tighter enforcement measures is expected to remain central to Himachal Pradesh's revenue mobilisation efforts in the coming months. (ANI)