No takers for Vohra’s motor-tax reform plan

J&K continues to lose huge revenue

JAMMU: The much ambitious initiative of Governor N N Vohra to affect the first major revision in state’s vehicle-taxing structure has failed to see the light of the day, even after eight months have passed, while the state continues to lose major revenue from registration of vehicles, road taxes and penalties from traffic-rule violators.

In line with the stress he has put on two important issues ever since he took over as Jammu and Kashmir’s governor ten years ago, Vohra in November last year had promulgated 'The Jammu and Kashmir Motor Vehicles Taxation (Amendment) Ordinance, 2017', thus setting the stage for what would have been first major revision in 61-year-old legislation, which besides enhancing the vehicle registration fee, also envisaged a significant hike in penalties for violating traffic rules, so as to bring on track the haphazard road manners and blatant defiance of traffic rules.

However, the ordinance which was also tabled in State Legislative Assembly early this year has been well forgotten as its provisions are yet to be implemented in the state.

On November 12, 2017, Vohra had accorded assent to the said ordinance-third to be promulgated by him within 16 days which sought to amend Sections 3 & 4- providing for various taxes to be levied on motor vehicles- of the 1957-legislation, a long-awaited move considering the existing fees and taxes were not revised for a considerably long period, besides giving for stricter punishment-monetary and otherwise- for violating traffic rules.
These amendments, which were to be carried out through the Ordinance, would have empowered the Government to revise and enhance the existing fees and taxes, for vehicles of various categories plying in J&K, beyond the limits stipulated in its Schedules I and II, so as to generate a major chunk of revenue which the state was losing compared to rest of India.

It is to be mentioned here that the vehicle owners in state-currently at 16,57,433, and growing at over 1.5 Lakh every year- have been enjoying one of the lowest taxes in the country. While the entire country, gradually, moved to percentage based taxes on vehicle registration and road taxes, Jammu and Kashmir didn't see any major revision and remained stuck to the fixed charges which are meager, to say the least, in majority of the cases, costing lesser than the insurance charges of the vehicles.

In our state, any Light Motor Vehicle-car up to the engine capacity of 1405 CC has to pay Rs 6000, while those over-and-above this capacity had to shell out Rs 20000, still inexpensive in comparison to other states which levy tax based on certain percentage of the cost of vehicle.

To put things in perspective, states in South India charge 10% of the cost of vehicle up to Rs 10 lakh, going up to 15% for vehicles costing over 10 lakh. A basic hatchback costing Rs 6 lakh is taxed at Rs 60,000-- whopping 900% more than what one in our state pays, while an entry-level SUV costing Rs 12 lakh is taxed at Rs 1,80,000- compared to measly Rs 20,000 in our state.

Even in states up north, the minimum tax levied upon vehicles is 6%, way higher than what we pay here.

Similarly, a two-vehicle owner in our state would pay Rs 2400 as road tax for non-geared one, and Rs 4000 for geared one, while the same is taxed at 10% of the vehicle cost in most parts of the country.

With new amendments coming in place, these slabs were slated to go much higher, thus contributing a major chunk to revenue of the state, considering the pace of new vehicle owners, with more than 1.5 Lakh new vehicles coming on state roads in 2017-2018.

However, as things stand today, there has been no sign of all these changes.

An Assistant Regional Transport Officer confirmed to The News Now that the vehicles have been taxed at the earlier rates only.

“The last revision that came in December 2016, left the road tax structure untouched while increasing the application fee from Rs 100 to Rs 300 for two-wheelers and to Rs 500 for four-wheelers,” he told this scribe.

The Ordinance had also sought to revise the penalties imposed to vehicle owners in case of traffic violations, something Governor had put stressed upon in past too.

It is relevant to note that while the State Motor Vehicle Department is administering the Central Motor Vehicle Act, 1988, and the J&K Motor Vehicles Taxation Act, 1957, the penalties which have been levied for the past many years are meager and, therefore, do not have any mentionable deterrence qua those who continue to violate the traffic safety norms, leading to a progressively increasing number of fatal road accidents, from year to year.

The Governor- known as someone of the original steel frame bureaucracy of India, had sought to control the road violations, besides the number of accidents, making fines for violating traffic rules more expensive.

It would be recalled that the Governor had repeatedly exhorted the successive State Governments to impose stringent penalties on all those who violate the traffic laws and regulations, including confiscation of vehicles which are no longer fit to be operated.