One country, one road tax..! What benefits..?
India's automobile sector contributes 6.4% to the country's GDP, 35% to manufacturing GDP, and 1.5 lakh crore in GST contribution. Since the implementation of the Goods and services Tax (GST), automobile companies have also shifted their product car prices to a single ex-showroom price across India. Earlier it was priced based on local taxes and different vehicle prices per state.
In this situation, the idea that one india is one tax has been released. Will the central government accept this..? Even though there are no major changes in the prices of cars after GST, the road tax varies from state to state. In this situation, many save a few thousand by buying a car in a different state than their own state. But driving a car bought in one state in another state is not a problem for a while, but it is a problem in the long run. To overcome this, the vehicle must be registered and road tax paid in the state where the vehicle is being used again.Meanwhile, the varying state-to-state road tax is a major problem for vehicle owners, especially for those who change jobs frequently. The ex-showroom price of cars after GST is the same across india but road tax varies from state to state. For example, the maruti Suzuki Wagon R LXI variant is priced at Rs 547,500 ex-showroom. Road tax in Andhra Pradesh, Telangana, and karnataka is Rs 76,650. With this, the on-road price is Rs.668,784. Meanwhile, the road tax in puducherry is just Rs.11,000 for this car, bringing the on-road price to just Rs.588,108.Generally, road tax is levied based on various factors like engine capacity, seating capacity, unladen weight, price, etc. But it varies based on each state's business model and automobile market sales. Some states have separate tax regimes for private and company vehicles, while others tax the vehicles based on the fuel they run on (petrol, diesel, or CNG). Some states also have a slab for vehicle tax like income tax. That is, there is a practice of levying tax based on the price of the car.This being the case, imposing a single road tax across india would have many benefits only for those migrating to other states. Firstly, it will reduce the purchase of vehicles from states with low road tax. Secondly, it will make it easier to transfer vehicle registration from one state to another. But if it is brought as a single road across india, it will directly affect the revenue of the states. Many states have already lost revenue due to GST, in which case one country, one road tax will also have a big impact. In india, where the people and the state are diverse, the one-country-one-data-size-fits-all solution may benefit some but harm others. States also vary economically.