The Karnataka State Government is planning to introduce a road tax on electric vehicles (EVs), potentially impacting the growing popularity of EVs in the region. Currently, EVs enjoy an exemption from road tax, but the proposed change may result in higher prices for these vehicles.
The number of registered EVs in Karnataka has been steadily increasing, reaching 2.36 lakh vehicles. In 2016, Karnataka introduced an EV policy that exempted both four-wheeler and two-wheeler EVs from road tax starting from April 1, 2016, and 2017, respectively.
Nevertheless, the government is currently contemplating the removal of the exemption on road tax, which allows a zero per cent tax rate, and proposing a road tax of 50% instead. The state’s road transport authority has submitted a proposal to this effect.
Currently, road tax for internal combustion engine (ICE) two-wheelers in Karnataka varies based on the vehicle’s cost. For four-wheelers, the road tax is determined by different price ranges. EVs account for a significant portion of registered vehicles, with two-wheelers dominating the market share.
While EV sales are spread across Karnataka, Bengaluru has emerged as the leader, with a substantial number of registered EVs. The proposed imposition of road tax on EVs has raised concerns among EV enthusiasts, who highlight factors such as battery longevity, high replacement costs, and the lack of servicing infrastructure as ongoing challenges for EV adoption.
They urge the government to continue the zero road tax for EVs in the coming years, especially considering the relatively higher costs of EVs compared to internal combustion engine (ICE) vehicles. It is worth noting that the Central Government has already implemented a reduction in subsidies for EVs.