Gujarat’s transport department has exposed a loophole where owners of luxury foreign vehicles, priced at Rs 50 lakh or more, are registering their vehicles in neighbouring states to evade the state’s high road tax.
The inquiry found that more than 125 such vehicles, including 25 high-end cars, are frequently driven and serviced in Gujarat, despite being registered elsewhere.
Gujarat has a high tax on foreign-made cars which is 12 per cent, but nearby places have a lower tax which is 6 per cent. Some people are cheating by registering their cars in these nearby places and then using them in Gujarat to avoid paying the higher tax.
A probe revealed 125 such vehicles were regularly brought to the service stations in the state.
Ahmedabad Road Transport Officer J J Patel told a section of the media that they also got hold of their FastTag details. They zeroed in on 10 odd vehicles, which have been plying on the state roads for over three months and have already issued them notices. According to the rules, any vehicle which is used for three months or more in a particular state invites the RTO tax of that state.
According to officials, the road tax on a Rs 1 crore vehicle is Rs 12 lakh in Gujarat, compared to just Rs 6 lakh in other states and union territories.
Many vehicles, including those in the mid and small segments, used in Gujarat are registered outside the state, not just high-end cars. Dealers facilitate this by registering vehicles using house rent agreements.
“While registering such high-end cars, one must check why a rent agreement is being used as address proof. The transport officials must question why the owner of a car worth more than Rs1 crore should provide a rent agreement,” the officer said.
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