Even though the Union Government has reduced central excise duty on petrol and diesel with immediate effect, consumers in Himachal Pradesh may not see significant price relief. The state government is reportedly considering a new “Orphan and Widow Welfare Cess” on fuel, which could offset the benefit from the Centre’s reduction.
The Finance Ministry’s notification (No. 05/2026) of Central Excise revised excise duty on petrol to ₹3 per litre and eliminated the duty on diesel. The reduction is intended to ease inflationary pressures and provide modest relief to consumers amid volatile global crude oil prices. The changes apply immediately but do not affect petroleum products meant for export.
However, Himachal Pradesh’s recently passed Finance Bill proposes a cess of ₹2–3 per litre on petrol and diesel, earmarked for the welfare of orphans and widows. Officials said the levy is aimed at supporting vulnerable sections of society while helping the state manage fiscal constraints and welfare obligations. The cess has not yet been officially notified.
Experts warn that if the state implements the levy, the net benefit for consumers could be negligible, highlighting the challenge of balancing state revenue needs with national tax reductions. A final decision on the fuel cess notification in Himachal Pradesh is still awaited.
Nurturing Creativity – Keekli Charitable Trust, Shimla
