Deputy Chief Minister Mukesh Agnihotri has highlighted that Himachal Pradesh is confronting a projected revenue deficit of Rs 10,000 crore due to the cessation of the Revenue Deficit Grant by the Union Government. Speaking to the media after a meeting with Congress party leaders Mallikarjun Kharge and Rahul Gandhi in New Delhi, Agnihotri emphasized the financial pressures faced by the state. He indicated that this grant, which had been received consistently over the past five years, was abruptly halted by the central government, leading to significant concerns regarding the state’s financial health.

Congress Leaders Address Financial Concerns

Vinay Kumar, President of the Himachal Pradesh Congress, echoed Agnihotri’s sentiments, confirming that discussions during the meeting focused on critical issues affecting the region. He noted topics included the apple industry and the Revenue Deficit Grant cessation, which are vital for the local economy. Additionally, Rajani Patil, a Congress member of the Rajya Sabha, shared that organizational matters were also on the agenda. Patil mentioned that the audit of state ministers was requested by Rahul Gandhi, and she was tasked with overseeing this initiative.

Strategies Implemented to Address Revenue Shortfall

With the discontinuation of the Revenue Deficit Grant after recommendations from the 16th Finance Commission, the Himachal Pradesh government is contending with heightened fiscal pressures. To address this challenge, the state has initiated a range of reforms aimed at enhancing internal resource mobilization. One such reform includes the introduction of a new Toll Policy for the period 2026-27, which enforces transparent electronic auctions for toll barriers and implements electronic toll collection. This system is augmented by CCTV monitoring and a phased implementation of FASTag to ensure efficient revenue flow while minimizing leakages.

Excise Reforms and Vehicle Entry Fee Adjustments

Another crucial component of the state’s financial strategy is excise reform, which continues the policy of auction-based liquor vending allotments with adjusted reserve prices reflective of previous revenue performance. The introduction of enhanced digital monitoring and stricter enforcement measures is anticipated to strengthen license fees, excise duty, and value-added tax collections. Moreover, starting April 1, 2026, the state will raise entry fees for vehicles entering Himachal Pradesh across various categories. Officials have argued that implementing technology-driven solutions and transparent bidding processes will bolster compliance and help counterbalance revenue declines resulting from the loss of the Revenue Deficit Grant. However, stakeholders within the tourism sector have expressed concerns regarding the potential impact of increased travel costs on their businesses.

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