LUCKNOW: Buying a private, non-electric vehicle is set to get expensive in Uttar Pradesh. The Yogi cabinet approved a proposal to increase the existing tax on vehicles above 40,000 by 1% on Tuesday in light of a loss of “thousands of crores” due to a subsidy being provided on electric vehicles.
Transport minister Daya Shankar Singh said that the tax hike would apply to only private vehicles—both two- and four-wheelers—that cost more than 40,000. There has been no change in transport tax slabs since 2009.
“Non-air conditioned vehicles of less than Rs 10 lakh will see the one-time transport tax go up from 7% to 8%. Similarly, the tax on air-conditioned vehicles which cost less than Rs 10 lakh will go up from 8% to 9%. For vehicles which cost more than Rs 10 lakh, the tax has been increased from 10% to 11%. For vehicles which are less than Rs 40,000, the existing tax slab of 7% will remain,” said the minister.
“The subsidy on EVs is resulting in a burden of thousands of crores on state exchequer. It has been decided to increase existing tax slabs by 1% to balance it out. This will result in additional earnings of Rs 450 crore for the government,” he said.