The state cabinet has approved a 2% hike in onetime vehicle registration tax on private two and four-wheeler vehicles. The cabinet has also capped the tax at a maximum of Rs 20 lakh to discourage registration of vehicles outside the state. The burden on vehicle buyers will be compounded by the recently introduced 2% road safety cess on this increased tax.
In Maharashtra, the tax is in the range of 9-11% for petrol driven cars based on the cost of the vehicle, and 11-13% for those that ply on diesel. The tax slabs will now increase to 11-13% and 13-15%, respectively.
Officials said following implementation of the Goods and Services Tax (GST) from July 1, the state government will lose nearly Rs 700 crore as revenue towards octroi and local body tax (LBT) on vehicles.It has, therefore, decided to make up for the loss by hiking the tax to help generate an annual revenue of Rs 750 crore. Reacting to the development, senior transport department officials said the rate of vehicle registration tax in the state depends on the cost of cars and engine power for two-wheelers, and whether these run on petrol, diesel or CNG.
