Karnataka Hikes Vehicle Registration Fees, Electric Cars Face Lifetime Tax

The Karnataka government has given the green light to a new law that will make registering vehicles in the state more expensive.

Governor Thaawarchand Gehlot approved the Karnataka Motor Vehicle Taxation (Amendment) Act, 2024, on March 6. The law was officially published in the gazette on March 7, as reported by Money Control.

Under this new law, a 3 percent extra fee will be charged on transport vehicles. This money will go into the Karnataka Motor Transport and Other Allied Workers Social Security and Welfare Fund.

Additionally, the government now has the power to impose a lifetime tax on electric vehicles (EVs). If an electric car, jeep, omnibus, or private service vehicle costs more than Rs 25 lakh, a 10 percent tax will be levied on its cost at the time of registration. This is the first time such a tax is being imposed on electric vehicles in the state.

Impact On Prices

Currently, Karnataka already has some of the highest road taxes in the country, ranging from 13 percent to 20 percent. The new 3 percent tax on transport vehicles will make owning a vehicle even more expensive.

The Karnataka Motor Transport and Other Allied Workers’ Social Security and Welfare Act, 2024, was also approved by Governor Gehlot on March 6. This law aims to provide social security and welfare measures for workers in the transportation sector.