'You pay cow tax on liquor, tolls, cement': Investment banker breaks down a ₹3,000 cr bill

Every drink, toll, or bag of cement in parts of India could be funding cow welfare. Investment banker Sarthak Ahuja highlighted the growing reach of “cow cess” taxes—applied on everything from liquor in Rajasthan to electricity bills in Haryana—raising fresh questions about transparency and return on public money.

In a LinkedIn post, Ahuja detailed how multiple Indian states levy indirect taxes explicitly for the protection and welfare of cows. “You pay a Tax for Welfare of Cows every time you drink liquor in Gurgaon and Jaipur… buy a vehicle in Punjab, or purchase cement and sand for construction in UP,” he wrote.

Rajasthan introduced one of the most prominent versions of the tax in 2018—a 20% cow cess on VAT applied to the sale of Indian Made Foreign Liquor (IMFL), beer, and wine. This translates to roughly 5% of the total retail price of liquor. The state is now considering a hike, taking the cess to 25%.

Revenue from these levies adds up. Rajasthan collects about ₹2,000 crore annually, Haryana around ₹500 crore, and Uttar Pradesh roughly ₹200 crore. Collectively, these states spend close to ₹3,000 crore every year on cow shelters and related welfare infrastructure.

Cow protection-related cesses are also embedded in property taxes, toll collections, and construction materials, depending on the state. Uttar Pradesh levies a cow cess on cement and sand. Madhya Pradesh applies it on property and vehicle sales. Haryana includes it in tolls and electricity payments.

Ahuja questioned the accountability of such dedicated levies. “There should ideally be no stray cattle on the roads,” he wrote, pointing to a potential mismatch between tax collection and visible outcomes.

While the concept of earmarked welfare funding is not new in India, the scope and scale of cow-related taxes—and the lack of clarity on their efficacy—have triggered renewed scrutiny of how public money is used and measured.