Evading Luxury Car Tax can Cost you Big Time

Source: Flickr

You guys pay your taxes, right?

Don’t you? Oh yes, you should be a tax paying good citizen irrespective of what government does with that money in future. Well, that’s the rule and you got to follow it religiously. And there are no confusions regarding this, you pay normal tax, land tax, house tax, tax for income from other businesses, tax on hotel food, tax on movie tickets and goes the list.

You got to pay the tax or things don’t go well in future. Expect the tax department barging into your tax to raid out the hidden black money in your house.

Not a scene you expect to happen often and of course with you.

Today’s article in on tax, and as you guessed, it related to your vehicles. What, you didn’t guess that? I thought you were smart :D, how many have used Orkut? Just asking.

We are going to discuss the road tax we have to pay when we buy a vehicle and how that tax different in different states and what happened recently that caught my attention. Well not recently but a couple of years ago.

What happened?

In December 2017, a case was filed against a renowned actor of Southern movie industry under IPC sections 464 (forgery) and 468 (forgery for the purpose of cheating).

What he did was, buying a luxury car (Audi Q7) from  Pondicherry/Puducherry, posing as a resident there while he actually lived in Kerala.

Now, why he did that? Well, if you don’t know the tax rates of these states, let me show you.

In Puducherry, the road tax he had to pay(as per news reports) is just 1.5 lakhs. But if would he have registered it in Kerala, the road tax could go up to 14-20 lakhs. Smart move huh, but wrong move too.

Transport commissioner Anil Kant asked the crime branch to register the case. Gopi had allegedly evaded tax by registering his luxury vehicle in Puducherry after he became an MP on May 24, 2016, reports Deccan Chronicle.

The Thiruvananthapuram RTO had issued a notice to him last month, seeking explanation on using a vehicle registered in Puducherry in the state.

In an earlier investigation done by Kerala Motor Vehicle Department, it was revealed that as many as 700 vehicles are registered at Puducherry, resulting in a revenue loss of a whopping 60 Cr to the state government.

Since many actors and people were found to be indulging in this kind of tactics to evade taxes have on stirred up controversy in the state, MVD is on a mission to explore every loophole in the system.

Well, 700 is a lot of people evading tax.

Source: 1zoom.me

Evading of road tax is not new but, this kind of big revelation has never happened in my knowledge. Well now that people have read this news last year, they will be getting ideas to find new loopholes in this law. You got to pay tax according to the State Govt’s rule to drive in that state, don’t you? Even if you are changing your home and shifting to another state, you got to pay sales tax on your car when you register the car in that state.

Why all this? Well because the state government made the roads dude! They want to maintain too, which I doubt.

Now let’s see different tax rates

New Car Registration Slabs - Road Taxes Applicable
City / State	Road Tax Fees for New Car Registration in 2019
Delhi - Individual Registration	Price Upto Rs. 6 Lac - Petrol Cars - 4%, Diesel Cars - 5%
	Price between 6 Lac - 10 Lac - Petrol Cars - 7%, Diesel Cars - 8.75%
	Price > Rs. 10 Lac as Exshowroom Cost - Petrol Cars - 10%, Diesel Cars - 12.5%
Delhi - Company Registration (Where Car Registered in name of Firm - Proprietorship / Partnership / Pvt Ltd / Ltd etc)	Price Upto Rs 6 Lac - Petrol Cars - 5%, Diesel Cars - 6.25%
	Price between 6 Lac - 10 Lac - Petrol Cars - 8.75%, Diesel Cars - 10.94%
	Price > Rs. 10 Lac as Exshowroom Cost - Petrol Cars - 12.5%, Diesel Cars - 15.63%
	+ MCD Parking Charges of Rs. 2000 for cars priced under 4 Lakh and Rs. 4000 for rest of the vehicles. Visit My car helpline for best deals
	.
Kerala	Less than 1500 cc 6% of purchase value 1500 cc and above 8% of purchase value
U.P (Uttar Pradesh) Ghaziabad, Noida, Kanpur, Meerut, Agra etc	8% If Price < 10 Lakh, else 10% Road Tax. No separate classification of Petrol, Diesel
	Additional Temporary Charges of Rs. 1500
	For used cars >15 years, new Green Tax Introduced in UP, Chargeable at time of renewal of registration. Green Tax Slabs yet to be known, it will be in addition to charges for Re-Registration + Smart Card
Haryana - last revised on 1st June 2015 Faridabad, Gurgaon etc	Price Upto Rs. 6 Lac - 5%
	Price between Rs. 6 Lac - 20 Lac - 8%
	Price above 20 Lac - 10%
Maharastra Mumbai, Pune, Nagpur, Navi Mumbai etc  updated on 4th July 2017
	Price < 10 Lakh - CNG @ 7%, Petrol @ 11%, Diesel @ 13%
	Price between 10 Lakh - 20 Lakh - Petrol @ 12%, Diesel @ 14%
	Price Above 20 Lakh - Petrol @ 13%, Diesel @ 15%
	Additional: If car bought in Company Name or bought by any Ltd or Pvt Ltd company, RTO Slabs would be double the slabs above. Starting GST - No Octroi and No LBT will be applicable
Andhra Pradesh, Telangana Hyderabad, Vijayawada ect	Price < 10 Lakh - 12%
	Price > 10 Lakh - 14%
	Additional : 2% RTO Tax, if buying 2nd Vehicle in same name and getting it Registered in A.P
Kerala Calicut, Cochin, Trivandrum, Thrissur etc.	Price < 5 Lakh - 6%
	Price between 5 - 10 Lakh - 8%
	Price > 10 Lakh, but Less than 15 Lakh - 10%
	Price > 15 Lakh but less than 20 Lakh - 15%
	Price > 20 Lakh - 20%
Karnataka	Price < 5 Lakh - 13%
Bangalore, Mysore	Price between 5 - 10 Lakh - 14%
	Price between 10 - 20 Lakh - 17%
	Price > 20 Lakh - 18%
Odisha	Price < 5 Lakh - 6%
Bhubhaneshwar	Price between 5 - 10 Lakh - 8%
	Price above 10 Lakh - 10%
Tamil Nadu	Price < 10 Lakh - 10%
Chennai, Combatore, Madurai	Price > 10 Lakh - 15%
West Bengal - Kolkata (One Time Tax for 5 Years) - whichever higher	5.5% or Rs 17500 in 800 cc Cars
	5.5% or Rs 25000 in between 800cc to 1490cc Cars
	5.5% or Rs 35000 in between 1490 to 1999cc Cars
	5.5% or Rs 45000 in above > 2000cc Cars
West Bengal - Kolkata (LifeTime Tax for 15 Years) - whichever higher	10% or Rs 40000 in 800 cc Cars
	10% or Rs 55000 in between 800cc to 1490cc Cars
	10% or Rs 80000 in between 1490 to 1999cc Cars
	10% or Rs 1 Lakh in above > 2000cc Cars
Chandigarh	All Cars Priced uptil 20 Lakh - 6%
	Above 20 Lakh - 8%
	Zero Road Tax in Chandigarh for People Buying Car with Disability or NGO and Social Welfare Group registered with Social Welfare Department and work for people with disabilities.
Punjab	Flat 8% of Ex-showroom price of car, irrespective of Value or Fuel Type. Also now additional 1% Surcharge Tax levied on Ex-showroom price as Social Security Contribution
Gujarat	Road Tax will be approx 6% (Individuals Cases) and 12% (For Company). For CKD Imported Cars - Road Tax will be Double the rates of CBU Cars.
Ahmedabad, Surat, Vadodara etc	Additional: Municipality Tax
	Even - an additional VAT Duty will be applicable at rate of 5% on buying SUV and Luxury Cars in Company Name and thus will be Ex-showroom price different on Buying Cars in Individual Name and Company Name
Rajasthan	7% - 9% (for Petrol Cars)
Jaipur, Alwar, Bikaner, Ajmer etc	10% - 11% (for Diesel Cars)
Bihar	7% (For Cars Priced under 8 Lakh)
Patna, Gaya etc	13% (For Cars Priced above 8 Lakh)
Jharkhand	6% (For Cars Priced under 15 Lakh)
	9% (For Cars Priced above 15 Lakh)
	Additional Tax: Further additional 3% Tax on Buying 2nd Car in name of Same Owner
Uttarakhand (revised effective January 2019)	Price Upto 5 Lakh - 8%
Dehradun, Rishikesh	Price in between 5 Lakh to 10 Lakh - 9%
	Price above 10 Lakh - 10%
Himachal Pradesh	Cars less than 1000cc - 2.5%
Shimla, Solan	Cars greater than 1000cc - 3%
Pondicherry (Puducherry)	Minimum Rs 8000 Tax for Cars under Rs 5 Lakh
	Rs 11K for Cars in 5 Lakh - 8 Lakh
	Rs 15K for Cars in 8 Lakh - 15 Lakh
	Rs 60K Flat Road Tax for Cars above Rs 15 Lakh - 20 Lakh
	Rs 1.1 Lakh Flat Road Tax for Cars in Rs 20 Lakh - 30 Lakh
	Rs 1.25 Lakh for Cars above Rs 30 Lakh
Madhya Pradesh - MP Indore, Gwalior & other cities in MP
	7% Flat at Exshowroom Price of Vehicle (if ex-showroom under 10 Lakh)
	8% (Petrol) / 9% (Diesel) (if ex-showroom above 10 Lakh).
Goa	9% for Cars less than 6 Lakh
	11% for Car at Exshowroom Price from 6 Lakh till 9.99 Lakh
	12% for Car costing 10 Lakh and more
	Infrastructure Cess: Additional applicable on Cars Priced above 10 Lakh. Rs. 12,000 < 10 to 20 Lakh. 40,000 < 20 - 40 Lakh. 75,000 < 40 - 60 Lakh. 1,00,000 > 60 Lakh

If you like this post, subscribe to our blog to receive quick notifications of our updates.  And comment below if you have any doubts regarding this article and let us know if you wish to see a review of any particular automobile.