State says no to uniform motor vehicle tax
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Thiruvananthapuram: Responding to the proposal by the Central government to introduce a uniform motor vehicle tax system across the states, Kerala Transport Minister has said that the system will not be beneficial for the state.
“This proposal gains significance in the backdrop of the GST which is not beneficial or fruitful to the state as on today,” he said in a letter to the Union Transport Minister Nitin Gadkari.
The state minister pointed out that as per Article 246(3) and entry 57 in list II - state list of the Constitution of India, only the state legislature is competent to make laws regarding taxation of vehicles. Hence any attempt on the part of the Ministry of Road Transport and Highways, to legislate on Motor Vehicle Taxes and thereby harmonise the tax rates of motor vehicles is unconstitutional and violate the basic principles of the Constitution.
In Kerala, Saseendran said, 6 pc to 20 pc of the value of the vehicle is fixed as the rate of tax. If the above rate of tax is fixed from 8 pc to 12 pc, the revenue of the state will be badly affected and the income will be reduced by about `150 crore per year, he said.
The letter also expressed the concern of the state over the proposed system of national permit for contract carriages operating inter-state, which also will badly affect the revenue of the state.