On 9th September, the Chief Minister of Himachal Pradesh, Sukhvinder Singh Sukhu, introduced the Himachal Pradesh Electricity Duty Amendment Bill, 2024, in the Assembly. The bill proposes to impose a milk cess and an environment cess on consumers. It seeks amendments to the Himachal Pradesh Electricity (Duty) Act, 2009, with the insertion of Sections 3A for the milk cess and 3B for the environment cess.
As per reports, the Congress-led HP government has planned to impose a milk cess of Rs 0.10 per unit on power consumers. Zero-bill consumers have been exempted from the cess. Furthermore, the bill includes a provision that empowers the state government to modify the milk cess by up to 50% through notification. The government plans to use the revenue collected from the cess to strengthen and uplift milk producers in the state.
The bill also proposes an environment cess for various categories of power consumers. According to the bill, Rs 0.02 per unit will be applicable for small industrial power consumers, Rs 0.04 per unit for medium industrial power consumers, and Rs 0.10 per unit for large industrial and commercial power consumers. Additionally, a charge of Rs 2 per unit will be imposed on temporary connections and stone crushers. Electric vehicle charging stations will also have to pay a higher per unit price at Rs 6 per unit.
The government claims that the aim behind imposing the environment cess is to promote power generation using solar energy and to protect the environment. The government has the authority to modify cess rates similar to the milk cess. The bill was scheduled to be discussed in the HP State Assembly on 10th September.
Notably, in March 2023, the government of Himachal Pradesh imposed a Rs 10 milk cess on every bottle of liquor in the state. However, the COVID cess imposed on liquor bottles was removed at that time. In addition, a Rs 2.5 cow cess is also imposed on liquor bottles.
Himachal Pradesh is facing a dire economic crisis. In August 2024, HP CM Sukhu announced deferring his salary, allowances, and other benefits for the next two months, citing the financial crisis. The government also planned to legalise the limited use of cannabis for medicinal purposes to improve the state’s finances.
“The CM has taken a good initiative to overcome the financial troubles we are facing in the state. We are trying to strengthen the resources in the state – be it through water resources or our excise policy and mining policy. We are also trying to legalise cannabis for limited purposes like medical use,” said Himachal Pradesh minister and Congress leader Vikramaditya Singh.
Earlier, CM Sukhvinder Singh Sukhu announced that he and his cabinet have decided to forgo two months’ salary as a symbolic measure to address the state’s fiscal challenges.
