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India Slashes Truckers Tax

by Mary Swire,, Hong Kong

06 December 2010

The proposed nationwide strike over the toll tax by Indian truckers this week has been called off after an agreement was made between the All India Motor Transport Congress (AIMTC) and the Ministry of Road Transport and Highways. The tax has now been slashed by nearly 30% for commercial vehicles.

Shri Nath, Road Minister, said that a separate category, three-axle commercial vehicles, will be incorporated in the National Highways Fee (Determination of Rates and Collection) Rules, 2008. It was agreed that the present base rate of user fee for this category of vehicles will now be INR2.40 (USD0.05) per km against the present user fee base rate of INR2.20 per km for bus/truck category. It was further agreed that the difference between the user fee rates for the two-axle bus/truck category and the three-axle commercial vehicle category would generally not be more than 10%.

The Minister also announced that after the concession period is over the user fee will be charged by the government for maintenance and development at a lower rate of 40% of the rates applicable at the time of completion of the concession period. The normal provisions of annual increase due to inflation indexing would be applicable.

A separate class under the concession category will be created in the National Highways Fee (Determination of Rates and Collection) Rules, 2008 to provide a 50% concession on user fees chargeable at toll booths located in a district, for local commercial vehicles registered within the district (excluding vehicles plying under a National Permit). Local vehicles would be defined on the basis of address of the owner of the vehicle (address being the same district as the toll booth) mentioned in the registration certificate. It is proposed that this would help small farmers and traders in the districts.

It was also agreed that all other pending issues of the truckers will be looked into by the Indian government within the next few months. These include the provision of service roads and highway facilities etc.

TAGS: tax | India | inflation

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