Punjab’s Electric Car Owners May Get 95% Concession on Token Tax

The Punjab Excise and Taxation Department has proposed a massive incentive to electric vehicle (EV) owners in a bid to minimize air pollution. The proposal recommends that the government reduce the token tax for EV owners by 95 percent to encourage their use in the province.

The proposal was presented by the Motor Registration Authority (MRA) which operates under the provincial excise and taxation department. It requested the government to charge nominal taxes on EVs of all sorts to speed up attempts to improve air quality.

Central Punjab is one of the most polluted regions in the world and the provincial government reportedly seeks to curb the use of diesel and petrol-powered vehicles that contribute to the pollution. It also reimposed full token tax rates on the purchase of 10-year-old vehicles in August to minimize their use in the province.

The government offered relief of 25 to 30 percent on token taxes in June which was later re-enacted to discourage the use of decade-old vehicles in the region. The authorities have the right to cancel the vehicle registrations of non-compliant car buyers or even imprison non-compliant vehicle owners in this regard.

The authorities have reportedly recommended the imposition of a 10 percent increase in taxes on decade-old vehicles each year on a progressive basis. The recommendation is intended to increase the purchasing cost of older vehicles so that car buyers refrain from buying or using them.