All you need to know about road tax in India
When you buy a new car or motorcycle from a dealership, you may have noticed that the price quoted in the dealership brochure or on the company’s website is much lower than the actual price. This could be as low as Rs. 15,000 or as high as Rs. 10, depending on your state.
The base price of a motorcycle or quad bike is the manufacturing price plus the registration fee, the road tax and the insurance. This adds up to around 10% to the total price of the vehicle.
While the registration and insurance fees are quite straightforward, the vehicle owners will have to pay the government road tax to drive their vehicle in the state they are in.
Let’s answer all your questions about this tax collected by the government of India so you can drive your vehicle on Indian roads. As well as what are the benefits of paying the tax.
Table of Contents
What is a road tax?
A road tax is a tax that is levied on the purchase of a new vehicle. It is used to maintain the infrastructure of Indian roadways. The amount of road tax varies depending on the type of vehicle, the state in which it is registered, and its age.
Road tax is a one-time payment that is made when you purchase a new vehicle. It is not a recurring tax. However, you may need to pay a renewal fee every few years to keep your vehicle’s registration valid
Why are Road Tax charged by buyers?
Road tax is levied on buyers to generate revenue for the government to maintain and develop the road infrastructure. This includes building new roads, repairing existing roads, and maintaining traffic signals. Road tax also helps to fund public transportation projects, such as buses and trains.
Who receives Road Tax and why is it State Level?
Road tax is levied by the state governments in India. This is because the state governments are responsible for the construction and maintenance of most roads in India. The central government is only responsible for the construction and maintenance of national highways.
The state governments have different road tax rates and slabs. This is because the cost of maintaining roads varies from state to state depending on factors such as the terrain, the population density, and the volume of traffic.
Here are some of the reasons why road tax is received on the state level:
- The state governments are the ones that are responsible for the construction and maintenance of most roads in India.
- The cost of maintaining roads varies from state to state.
- The state governments need to have the flexibility to set their own road tax rates to meet their revenue needs
Road tax is an important source of revenue for the state governments to fund road infrastructure development. It is also a way to ensure that all users of the roads contribute to their maintenance and upkeep
Benefits of paying road tax
- It helps to fund the construction and maintenance of roads and bridges.
- It helps to improve the quality of roads and reduce traffic congestion.
- It helps to make roads safer for everyone. It contributes to the overall economic development of the state.
If you do not pay road tax, you may be penalized by the government. The penalty may vary from state to state, but it can be significant. In some cases, you may even be impounded your vehicle.
Therefore, it is important to pay your road tax on time. You can pay road tax online or in person at the Regional Transport Office (RTO)
Parivahan Road Tax , who needs to pay and when?
Who
Every owner of a motor vehicle registered in India has to pay Parivahan road tax. This includes two-wheelers, three-wheelers, four-wheelers, and commercial vehicles.Parivahan road tax is a one-time payment that is made when you purchase a new vehicle. You do not need to pay Parivahan road tax every year. However, you do need to renew your vehicle’s registration every few years, and you may need to pay a renewal fee at that time.
When
You must pay Parivahan RTO tax at the time of vehicle registration. If you are buying a new vehicle, the dealer will usually collect the road tax on your behalf and pay it to the RTO. If you are buying a used vehicle, you will need to pay the road tax yourself.
Ways to pay road taxes in India: online and offline
Online
To pay road taxes online, you can visit the Parivahan website.
1. Go to the Parivahan website.
2. Create an account or log in to your existing account.
3. Add your vehicle details.
4. Select “Pay Parivahan RTO Tax” from the list of services.
5. Make the payment using a credit/debit card, net banking, or UPI.
Offline
To pay road taxes offline, you can visit your local RTO.
1. Visit your local RTO.
2. Carry the following documents with you:
• Vehicle registration certificate (if you have one)
•Insurance certificate
•Pollution Under Control (PUC) certificate •Proof of address
• Identity proof
3. Fill out the necessary form and pay the road tax amount.
Documents required
The following documents are required to pay road taxes in India:
• Vehicle registration certificate (if you have one)
• Insurance certificate
• Pollution Under Control (PUC) certificate
• Proof of address
• Identity proof
Payment methods
You can pay road taxes in India using the following Payment methods:
• Credit/debit card
• Net banking
• UPI
• Cash
Processing fee on Road Tax
There is a small processing fee that is charged when you pay road taxes online or in person. The amount of the processing fee varies depending on the state in which you are paying the road tax.
Penalty for late payment on Road Tax
If you fail to pay your road taxes on time, you may be charged a penalty. The amount of the penalty varies depending on the state in which you are paying the road tax.
Factors that affect road tax in India
Here are the factors that affect road tax in India
- Vehicle type: Two-wheelers, three-wheelers, four-wheelers, and commercial vehicles have different road tax rates.
- Engine capacity: Higher engine capacity vehicles have higher road tax rates.
- Fuel type: Petrol and diesel vehicles have different road tax rates.
- Age of the vehicle: Older vehicles have lower road tax rates.
- State of registration: Road tax rates vary from state to state.
- Seating capacity: Vehicles with higher seating capacity may have higher road tax rates.
- Wheelbase: Vehicles with longer wheelbase may have higher road tax rates.
How to claim refund on RTO Road Tax ?
To claim a refund on RTO Road Tax, you need to obtain a NOC from your current RTO, register with the new state RTO, and pay the road tax again. Refunds require a request letter, smart card, chassis imprint, pollution and insurance documents, NOC, original road tax receipt, proof of migration, RTO Form 16 and DT.
Is there a road tax on other state vehicles?
If you’re only visiting one state, there’s no road tax. Only buyers of new vehicles are required to pay a road tax to that state’s government. If you’re moving, you’ll need to go to your existing RTO and get a new owner’s certificate.
If you still have any questions about road tax, you can contact your local RTO. They will be able to provide you with more information on the road tax rates in your state and the process for paying road tax.