Government Proposes Huge Hike in Vehicle Registration Fee

The government is mulling a change in the price scheme for the registration of vehicles in the country. This development comes close at the heels of the Motor Vehicles Amendment Act being passed in the lower house of the Parliament. The government’s latest draft proposal talks of a hike in registration charges and registration renewal charges for all kinds of vehicles in the country. This hike is charges is for fossil fuel based vehicles only. The electric vehicles will not be impacted by this proposed hike by the government. The move aims at making the adoption of electric vehicles more prominent in the country.

Currently, two-wheelers have to pay a registration charge of Rs. 50, this may be hiked to Rs. 1,000  if the draft proposal of the ministry of road transport is accepted. Similarly, two-wheeler owners will have to pay a hefty Rs. 2,000 as registration renewal charges. To give you some perspective, currently the registration charge for cabs is pegged at Rs. 1,000 but this will go up as high as Rs. 10,000 for registration charges and Rs. 20,000 for registration renewal charges.

Coming to the private car owners, they will may have to shell out charges as high as Rs. 15,000 for registration renewal and Rs. 5,000 for first time registration under the proposed move. The charges for registration or renewal for private light motor vehicle owners earlier used to be Rs. 600. This is the highest hike proposed by the government by far. Private owners of light motor vehicles are looking at a hike that will take the registration renewal up by 25 times! Similarly, the imported bike owners may now have to shell out Rs. 20,000 as compared to the current fee of Rs. 2,500. Even more high is the hike in renewal fees for medium and heavy goods/passenger vehicles as the renewal charges for them jumps from Rs. 1,500 to Rs. 40,000! While the registration charges for the same category takes a jump from Rs. 1,500 to Rs. 20,000.

The three-wheelers too will have to bear a heavy brunt as the highest jump has been proposed for three-wheelers. The registration charges for 3-wheelers will jump from Rs. 300 to Rs. 5,000, whereas the renewal charges will see itself multiply by 33 times and go from Rs. 300 to Rs. 10,000! However, people buying new vehicles after scrapping the old ones will be exempt from the registration charges altogether.

A government official talked to a leading daily about the changes proposed by the government that will likely take 30-45 days to implement and stated,

We have sought feedback from all stakeholders before notifying the final fee structure in the next 40-45 days. The proposal of steep increase in the renewal fee for commercial vehicles, particularly trucks, buses and other heavy vehicles by nearly 27 times is aimed at making people opt for scrapping them once they are over 15-years old.

It remains to be seen as to how the car industry reacts to this development as it is still reeling due to losses amid record slowdown in sales. The government states promotion of electric vehicles as the reason behind this move, but with the lack of charging infra for electric cars in the country, such measures will not go a long way, and may in fact only discourage sales in the auto industry that has been suffering lately.

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