The Telangana government, under Chief Minister Revanth Reddy, is reportedly planning to increase road tax for new petrol and diesel vehicles. This proposed hike is expected to affect two-wheelers priced above ₹1 lakh and four-wheelers costing over ₹10 lakh. Officials have already started groundwork for the move, with a formal announcement anticipated soon.
The state transport department has conducted a detailed study of road tax structures and vehicle registration practices in neighboring states. The findings will be submitted to the state cabinet subcommittee, paving the way for a government order (GO) on the revised tax structure.
Kerala and Tamil Nadu, with road taxes as high as 21% and 20% respectively, have been cited as benchmarks for boosting revenue. Telangana had earlier revised its tax slabs in 2022, setting rates between 12% and 18%, contributing to a significant increase in revenue for the transport department.
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Road tax constitutes a major share of the department’s income. Official data reveals collections of Rs 3,971.39 crore in 2021-22, which rose to Rs 6,390.80 crore in 2022-23 after the tax hike. For 2023-24, revenue touched Rs 6,990.29 crore. The government believes the proposed increase could generate an additional Rs 2,000 crore annually, bolstering the state’s financial resources.
This move aligns with efforts to enhance revenue through strategic adjustments while mirroring taxation policies in other southern states. Further developments are awaited as stakeholders prepare for the potential impact.
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