Himachal Pradesh Entry Tax Rollback: Sukhu Reverses Hike After Punjab-Haryana Border Protests

Himachal Pradesh Entry Tax Rollback: Sukhu Reverses Hike After Punjab-Haryana Border Protests

North Desk Bureau

Chandigarh, March 31

Q. What exactly did CM Sukhu announce on Tuesday?

Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu first announced a rollback of the recently enhanced entry tax on vehicles at border checkpoints. Then the tax was ‘rationalised’ and not fully withdrawn. Under the revised rates, five-seater vehicles will pay Rs 100 and 6-12 seater vehicles will pay Rs 100 too. The proposed hike had increased the tax to Rs 130 for both categories. Additionally, residents living within five kilometres of entry points will be provided special passes to ease the burden on daily commuters.

Q. What triggered the rollback? What was the protest about?

The anger had been building for over a week. At the heart of the unrest was a sharp increase in entry tax from Rs 70 to Rs 170 on vehicles from other states entering Himachal Pradesh. The decision triggered widespread resentment among residents living in border areas, many of whom frequently cross the state boundary for work, trade and daily needs.

The flashpoint came on the Punjab side. Farmers and local residents from the Ghanauli area in Ropar district blocked traffic on the Ropar-Nalagarh road for nearly two hours, demanding an immediate rollback of the revised toll. The protests then escalated dramatically. Demonstrators announced that after midnight on March 31, all entry points between Punjab and Himachal Pradesh could face an indefinite blockade, with routes likely to be impacted including the Kiratpur Sahib–Manali National Highway, the Ghanouli–Bharatgarh road, and 11 entry points in Ropar district and as many as 33 across Punjab.

Q. How did this become a Punjab-Himachal political flashpoint?

The issue quickly crossed state lines. During the Punjab Budget Session, AAP MLA from Ropar Dinesh Chadha raised the matter and proposed imposing a reciprocal entry tax on vehicles registered in Himachal Pradesh. Punjab Finance Minister Harpal Singh Cheema assured the Assembly that the matter would be examined from a legal standpoint. Meanwhile, Punjab Education Minister Harjot Singh Bains indicated that while the state might consider higher entry tax on Himachal-registered commercial vehicles, common commuters would likely be spared.

In Shimla, BJP’s Leader of Opposition Jairam Thakur converted the issue into a political siege. He warned that transport unions in Punjab had threatened to block Himachal vehicles from entering their state from the night of March 31, and said that even the Chief Minister’s convoy could be stopped — creating a serious law-and-order situation.

Q. What did Jairam Thakur specifically allege against the Sukhu government?

Thakur led a BJP protest outside the Himachal Pradesh Assembly premises on the 14th day of the Budget Session, accusing the government of taking “ill-considered decisions” that had triggered tensions along the Himachal-Punjab-Haryana borders.

He directly challenged the government’s claim that the hike was nominal. Thakur said entry tax on small vehicles had been raised from Rs 40 to Rs 170, while larger vehicles were being charged up to Rs 1,000. He warned that if Punjab and Haryana responded by imposing or increasing entry tax on Himachal vehicles, it would create even bigger problems for Himachalis who frequently travel to those states.

He also highlighted the human cost: people in border districts such as Una, Nahan, Nalagarh, Kangra and Bilaspur were facing serious difficulties in their daily lives, with even visits to relatives requiring passage through entry tax barriers.

Q. What was the government’s defence before the rollback?

The Sukhu government held its ground for several days, arguing the opposition was exaggerating. CM Sukhu clarified in the Assembly that no new tax had been introduced — only an increase in the existing entry tax, which had been in force for nearly three decades. He attributed the revision primarily to its integration with the FASTag system on National Highways.

He noted that revenue from toll auctions had risen from Rs 185 crore to Rs 228 crore and maintained that the opposition was engaging in political rhetoric rather than fact-based criticism. Even on Tuesday, Sukhu stated that confusion over the issue was being deliberately spread, even though the increase was nominal for most vehicle categories.

Q. What are the revised rates, and how do they compare to what was proposed?

Vehicle Category	Old Rate	Proposed Hike	Rolled-Back Rate
Up to 5 seater	Rs 70	Rs 130	Rs 100
6–12 seater	Rs 110	Rs 130	Rs 100
Larger commercial vehicles	Rs 130	Rs 170	Under review

Residents within 5 km of border entry points will receive special passes exempting them from regular entry tax collection.

Q. Is this episode fully resolved?

Not entirely. While the HP goverment has ‘rationalised’ the entry tax, thus seeking to address the most contentious passenger vehicle rates. However, the situation around larger commercial vehicles and the broader FASTag integration of the entry tax system remains a live issue. The government had also signalled that further rationalisation through a Cabinet meeting is likely.  

More fundamentally, the episode has exposed the financial stress within the Sukhu government. The Himachal Pradesh Assembly passed the state budget for 2026-27 at Rs 58,830 crore, with the Chief Minister indicating that the state may have to raise additional loans. The entry tax hike, critics argue, was a revenue measure born of that fiscal pressure — and the climbdown shows how politically costly such moves can be when they directly affect daily commuters on both sides of a state border.