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Road Tax Disparity on Cars in India. Shocking Price Difference from One State to Other

Road Tax Disparity on Cars in India. Shocking Price Difference from One State to Other

Road Tax Disparity is so much Widened in India where Car On Road Prices Varies to Extent of 2 Lakh. From 2.5% in Himachal to 17% in Karnataka


Road Tax Disparity on Cars in India

Óne India - One Price is what 50% True as its correct that Unity is Diversity and we as a nation stand together with Love and Free Market, but One Price possibly is incorrect as almost every state has different road tax slabs for calculation of registration charges on cars and even has disparity in way of calculation of Prices.

For Instance - See the Basis of Calculation of Road Tax

  • In Punjab, Chandigarh, Gujarat, Jharkhand - Road Tax is computed on Price before GST and Cess. For example Hyundai Crera attracts 45% Tax (28% GST + 17% Cess), here basis of calculation of Road Tax is that Base Price without GST and Cess would be what factored in for calculation of Road Tax Fees
  • While in almost all other States, UT - Road Tax is computed on Ex-showroom Price, which is what inclusive of GST and Cess


Also, see the Disparity on Road Tax Calculation

Where Some states / UT have very Low Road Tax Rates (as on 13th August 2020)

  • Himachal Pradesh has Road Tax of just 3% (as per last applicable rto slabs in 1st Week of August)

  • Chandigarh has just 6% of Base Price (Price before GST) for Cars under 20 Lakh. Even Gujarat has 6% on base Price
  • PuduCherry has fixed amount where they charge as low as Rs 11,000 (for Cars from Rs 5 Lakh to Rs 8 Lakh) and Rs 15000 (for Cars priced in between Rs 8 Lakh to 15 Lakh)


While some states charge in

  • In Maharashtra on Petrol Cars starts from 11% and goes to 13%, while on Diesel Cars from 13% to 15% and also almost 20% Road Tax if car bought on Company Name
  • In Andra Pradesh, Telangana - it starts from 12% and goes to 14% with additional 2% Tax if buying 2nd Vehicle in same name
  • In Karnataka, Road Tax Slabs from 13% to 18% along with additional Road Tax Cess and Infra Cess which further extends in Tax Liability on Buying Car
  • Even in Tamil Nadu - its 10% on Cars under 10 Lakh and 15% on Cars above 10 Lakh


Road Tax Differences - Case Study on Hyundai Creta

So for a Car Like Hyundai Creta Sx Diesel whose Ex-showroom Price is Rs 14.51 Lakh including Registration Charges, Road Tax and HP Fees is

  • Rs 18,000 in Puducherry
  • Around Rs 40,000 in Himachal Pradesh
  • Around Rs 65,000 in Chandigarh, Gujarat, Jharkhand

Same Car Charged at Road Tax, Registration and HP Fees of

  • Rs 2.75 Lakh in Karnataka
  • Rs 2.2 Lakh in Tamil Nadu
  • Rs 2.09 Lakh in Maharashtra
  • Rs 2.05 Lakh in Telangana, Andhra Pradesh

So, for some buying Creta Sx Diesel in Chandigarh, Gujarat, Jharkhand actually end up buying same car at almost Rs 2 Lakh lesser as in Karnataka and almost by Rs 1.5 Lakh against Maharashtra, Telangana, Tamil Nadu

Want to Know More about RTO Tax Differences - Use Online Calculator to find out Road Tax Charges on Cars

 Car Loan EMI Calculator

You will be pleasantly surpised the way Road Tax Varies from One State to Other State. Some states applied additional Tax on Second Vehicle, some States applies Municipality Tax on Buying Car in Select Cities too.

Even are vast differences in Road Tax Calculation on Neighboring States too. 

What are your thoughts, Do you agree that there is vast disparity !! Share your Comments on same.

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Thursday, 24 September 2020

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