Punjab government has decided to waive off 95 percent vehicle registration and token tax for electric vehicle (EV) buyers as proposed in Finance Bill 2022. The government has also devised some ways to bring EVs under the tax net. Here are the details:
- 1 kWh of an EV’s battery capacity will equate to an engine capacity of 18.77 cc
- A new subsection in the Punjab Motor Vehicles Taxation Act, 1958 (XXXII of 1958) will define an EV’s taxation worth through its battery size
Furthermore, the government will offer a five percent additional discount on token tax payments through electronic transactions. The token tax rebate sequence for FY2022-23 is as follows:
- 10 percent rebate in the amount of annual tax between July to September.
- Full payment of annual tax from October onwards.
- A penalty may be determined on the amount of annual tax under section 9 from 2023.
The government claims to have taken these measures to promote the use of EVs as it not only curbs fuel expenses but also protects the environment.