Himachal Pradesh Introduces 60 Paise Per Litre Widow and Orphan Cess, Sparking Border Fears
GS3Economy · S&T · Environment · Security· Fiscal policy, budget & taxation (GST)· Prelims·
Why in news
Himachal Pradesh introduced a 60 paise per litre Widow and Orphan Cess on fuel to fund welfare schemes, sparking concerns over revenue leakage due to cross-border fuel smuggling.
Background
Himachal Pradesh implemented the Widow and Orphan Cess on petrol and diesel starting August 12. The state estimates a collection of over Rs 1,000 crore annually from combined VAT hikes and cesses.
Facts for Prelims
- FactWidow and Orphan Cess: 60 paise per litre on petrol and diesel in Himachal Pradesh.
- FactEstimated annual revenue from VAT and cesses: Over Rs 1,000 crore.
- PlaceHimachal Pradesh: State implementing the new fuel cess.
For Mains
Q. Discuss the challenges faced by state governments in maintaining fiscal revenue while implementing welfare-oriented cesses in a federal structure.
Dimensions to cover in your answer
- revenue leakage and cross-border smuggling
- fiscal federalism and state autonomy
- social welfare funding mechanisms
Keywords: fiscal federalism · revenue leakage · social welfare · cess · inter-state trade
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This note is generated automatically from SatyaDheesh's news feed and mapped to the UPSC CSE syllabus. Check facts against the original report or PIB before using them in an answer.