Cars and two wheelers to cost more in Karnataka

"With noticeable increase in motor vehicle sales during the later half of this fiscal (2009-10) resulting in higher collection in motor vehicle taxes, the life time tax on various types of vehicles will be increased by one-two percent to collect Rs.2,200 crore during the next fiscal (FY 2011)," state chief minister B.S. Yeddyurappa said Friday.

Presenting the budget proposals, Yeddyurappa told the assembly that the life time tax on motor cycles and other two wheelers will be increased to 10 percent from eight percent for vehicles selling below Rs.50,000 and to 12 percent from 10 percent on those vehicles selling between Rs.50,000 and Rs.100,000.

"Similarly, life time tax on motor cars and jeeps will be increased to 13 percent from 12 percent on vehicles priced less than 500,000, to 14 percent from 13 percent on vehicles priced between Rs.500,000 and Rs.1 million, and 17 percent on vehicles selling between Rs.1 million and Rs.2 million instead of 16 percent this fiscal," Yeddyurappa, who also holds the finance portfolio, said.

On luxury cars selling above Rs.2 million, the life time tax will be 18 percent instead of 16 percent currently.The budget also proposes to levy life time tax of Rs.20,000 on new light goods vehicles of 3,000-5,500 kg instead of quarterly tax of Rs.1,200. Such vehicles, which are already in use, the life time tax will be an average of Rs.12,000 on the basis of the year of manufacture.

Yeddyurappa also modified quarterly taxes on omni buses with all-India permit to Rs.2,750 from Rs.2,500 and on stage carriages with special permit to Rs.1,000 from Rs.700.

Taxes on 1,000 kg construction vehicles such as mobile cranes, tower wagon, tipper, fork lift, air compressor and generator carrying vehicles will be levied a life time tax assessed at 10 percent of the selling price of the vehicle weighing 1,000 kg instead of Rs.200 quarterly.

"Additional resources of Rs.249 crore is expected from the revised or modified motor vehicle taxes in fiscal 2010-11," Yeddyurappa told the law makers.

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