Entry Tax Row Fuels Tensions At Punjab–Himachal Border, Sparks Law And Order Concern

Amid escalating protests, a threat to block vehicular movement, and rising law-and-order concerns at inter-state borders, tensions between Punjab and Himachal Pradesh have flared over the hill state’s decision to impose a hiked entry tax on all incoming private and commercial vehicles from Wednesday.

What has added to the growing developments is the Punjab government's threat to impose a reciprocal entry tax on vehicles from Himachal Pradesh entering the state.

Even as Chief Minister Sukhwinder Singh Sukhu has spoken to Punjab Chief Minister Bhagwant Singh Mann, explaining reasons for the increase to raise the state’s revenue and also offering some relief to the affected stakeholders, the crisis has only kept the heat on the Himachal Pradesh government.

In the state assembly, which also voted on the state’s budget for the year 2026-27 on Monday, the leader of the opposition, Jairam Thakur, alerted the government about the potential law and order situation at the entry points of the state, spilling over ahead of the tourist season.

Thakur raised the issue through a ‘Point of Order’ in the House, informing that protests had already started paralysing the mobility of the vehicles, which needed to be resolved by April 1, when the entry tax rates come into force.

He cautioned that the move could strain interstate relations, especially in light of reported objections from Punjab’s finance minister, and may lead to inconvenience or harassment of Himachalis travelling to the neighbouring state.

Thakur also drew the attention of the government to growing discontent among taxi operators and tourism stakeholders. “I urge the chief minister to take note of the developments and take up the matter with the Punjab government afresh and prevent escalation of the situation," he asked.

The chief minister assured that the government was aware of the developments but added that no new tax had been introduced. The government has ordered only an increase in the existing entry tax, which has been applicable for nearly three decades.

Sukhu claimed that the revision was primarily due to the integration of the entry tax with the FASTag system on National Highways. He assured the rates would be rationalised shortly.

The hike has minimal impact on small vehicles. Heavy vehicles too will see an increase of Rs 40, from Rs 130 to Rs 170. However, to mitigate hardship, the residents living within a 5-km radius of entry points will be provided relief through a pass system—a decision already taken by the cabinet,” he said.

But on the ground, there are demonstrations taking place against the move. The private taxi unions and tourism industry stakeholders in Himachal Pradesh are also agitated and asking for the scrapping of the hike in view of its impact on the tourism industry, as well as vehicles carrying goods to the state.

Senior BJP MLA from Naina Devi, Randhir Sharma, also raised questions over the steep hike and informed the state assembly that the contractors have appointed staff at the toll barrier and have started sending signals about the implementation of the new orders.

He feared that problems may increase after the implementation of the new system, as companies have started deploying their employees. Such actions could even create a law-and-order situation for which the government should show some seriousness.

“A situation of tension has arisen between the people of the two states. People from Himachal Pradesh and other states, including Haryana, are protesting and holding demonstrations at the entry points. The protesters have warned against the movement of vehicles from the state on April 1 onward. The situation will worsen further,” he said.

Haryana and Punjab residents, who visit the Baddi Barotiwala Nalagarh (BBN) industrial area for work, are upset over the steep increase in the entry tax on private vehicles from Rs 70 to Rs 170. They demanded a rollback of the decision. A large number of industrial workers visit the BBN area from Haryana and Punjab, either in buses or in their private vehicles. They will have to bear the additional levy from April 1.

Meanwhile, according to reports, the Doon Tempo Operators Union in Baddi staged a protest against the hike in entry tax, raising slogans against the state government and voicing strong opposition. The union warned that if the decision is not rolled back soon, it would be forced to take drastic action, including sealing the borders from April 1 and preventing vehicles from entering the state.

The union argued that the entry tax hike would have a direct impact on drivers of small vehicles and the transport business, thereby jeopardising their livelihoods.