Karnataka Imposes lifetime tax on EVs above $25 lakh and 3% additional cess

The trend of Electric Vehicle is rising with a great surge in the demand around the country.  But there is a big tax announcement on EVs that the Karnataka government announced today. After this imposition of additional cess and tax, registration of transport/commercial vehicles in Karnataka will become more expensive in the upcoming. The Karnataka government has amended the Karnataka Motor Vehicle Taxation Act.

Through this act, Karnataka imposes a 3% additional cess on the transport vehicle. As per the details, this additional 3% Cess will only be applicable on newly registered transport vehicles (commercial vehicles like buses, taxis, and auto rikshaws). Because of this, commercial vehicles can become more expensive in the upcoming days and people may see a rise in the final cost they have to pay.

The second and big announcement has been made regarding the imposition of a lifetime tax on electric vehicles (EVs) above the value ₹25 lakh. There will be a 10% lifetime tax on the cost of the Electric Vehicle at the time of registration of the new vehicle.

In March 2016, Karnataka people got an exemption on all EVs from paying road taxes. When the Karnataka govt announced zero registration fees for EV buyers, other states gave subsidies and encouraged people to buy EVs over fuel cars.