As the newly-implemented GST is beginning to settle down, the Maharashtra Transport Ministry has proposed for a hike in motor vehicle taxes. The bill was raised on Thursday.
As per the new proposal, tax for vehicles will vary according to the different tax slabs of vehicles.
The proposal claims since VAT and Octroi were abolished after the implementation of GST, it is necessary to raise motor vehicle taxes to compensate for the loss occurred.
According to the bill, the proposed taxes for petrol vehicles up to Rs 10 lakh is eleven percent, twelve percent for vehicles that cost up to Rs 20 lakh, and for those vehicles that cost upward Rs 20 lakh, the tax applicable will be thirteen percent.
As for diesel vehicles, the taxes are marginally higher. Vehicles costing up to Rs 10 lakh will be taxed ten percent, fourteen percent tax for those vehicles that cost up to Rs 20 lakh, and 15 percent tax for vehicles costing more than Rs 20 lakh.
For vehicles that run on LPG and CNG, taxes will be seven, eight, and nine percent for vehicles that cost up to Rs 10 lakh, Rs 20 lakh, and above Rs 20 lakh respectively. The current taxes stand at 8 to 10 percent for motorcycles and tricycles, 9 to 11 percent for petrol vehicles, 11 to 13 percent for diesel vehicles, and 5 to 7 percent on CNG and LPG vehicles.
With the implementation of Goods and Services Tax (GST), carmakers and customers have seen relief in the form of lowered prices for automobiles. Now, the hike in motor vehicles tax could unsettle the relief since customers will end up paying more for vehicles.