One For The Road (Tax)

Who, if any, are the winners in this proposed road tax hike?

As per these reports, come 2018 and buying a new car may be frightfully expensive in Chandigarh. Or will it? Here are some thoughts (and favourite conspiracy theories):

  • Will it really lead to increased revenue for the Administration? Or will it be another circle rate story – where higher taxes/ duties probably result in a reduced number of transactions?
  • Will people circumvent the proposed high road tax and just purchase in the neighbouring states?
  • Could this be a way to push any non moving inventory from the 2017 stock?
  • How would this impact the used car market?
  • Where would all the car dealers go if car sales actually fall or are capped?
  • Since most officials are deputed from neighboring states, does the figment of my imagination lead me to believe that this may be a way to boost car sales in those states?
  • And most importantly, what will the hiked revenue be used for?
  • Oh! And will the bankers find the higher cost of vehicle?
  • And will the tax authorities allow this to be a tax deductible (depreciable) expense?

Questions and more questions. I am sure, you have several as well. More importantly, what are the solutions?

  • The usual – improve public transport – what’s the plan (short AND long term) to provide and improve this, especially since that metro stands trashed.
  • Next up, why not impose a heavy entry tax on all non Chandigarh vehicles too?
  • Finally, since it seems that one of the key drivers for this proposal is parking issues, why not enforce parking in a stricter way? And ensure zero tolerance
  • Finally, since it seems that one of the key drivers for this proposal is parking issues, why not enforce parking in a stricter way? And ensure zero tolerance

Of course, who will bell the cat? Easier to tax, than enforce. More money in the kitty, then, hopefully.

So if you are planning to buy a car, buy it now. I ain’t worried. Cycles continue to be out of the ambit of regulatory oversight. For the moment, hopefully.

One Comment

  1. There are over a hundred standing counsel (advocates) currently empanelled by the Chandigarh Administration.

    Why do you grudge them the few thousands they will earn by (unsuccessfully) defending this in the High Court?

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