You may have to spend Rs 500 or Rs 1000 extra on your new bike or car registration

The Karnataka Assembly has approved the Karnataka Motor Vehicles Taxation (Second Amendment) Bill, 2024, introducing an additional cess on new vehicle registrations. Two-wheelers will face a ₹500 levy, while cars will be charged ₹1,000 during registration.

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Law and Parliamentary Affairs Minister H K Patil presented the Bill on behalf of Transport Minister Ramalinga Reddy. According to the government, the cess will strengthen the Karnataka Motor Transport and Other Allied Workers Social Security and Welfare Fund, which provides social security for transport workers.

The Bill amends Section 3A of the Karnataka Motor Vehicles Taxation Act, 1957, adding a sub-section mandating this cess alongside the existing 3% levy on transport vehicles.

Opposition leaders, particularly BJP’s R Ashok, strongly opposed the move, labeling it an additional burden on citizens already reeling from a recent fuel tax hike. He argued that the decision would further strain household budgets.

According to Moneycontrol, Karnataka is one of India’s top collectors of motor vehicle tax, levying an 11% cess under Section 3 of the Motor Vehicles Act. Of this, 10% funds infrastructure projects, equity investments in Bengaluru’s mass transit systems, and rural road development. The remaining 1% supports urban mobility initiatives.

The Bill now awaits approval from the Legislative Council before it becomes law. If enacted, it will add to the cost of vehicle ownership in the state, sparking debates over its financial implications for citizens.