Toll Tax Hike: What It Is And Why It¡¯s Collected

Toll Tax Hike: National Highways Authority of India (NHAI) has announced an average toll hike of 5 per cent starting Monday. The revised toll rates, which were initially scheduled to take effect on April 1, were deferred due to the Lok Sabha elections.

From June 3, toll taxes will be hiked at nearly 1,100 toll plazas across India including the Delhi-Meerut Expressway and Eastern Peripheral Expressway. India has invested billions of dollars over the last decade to expand the national highways with a total length of about 146,000 kilometres. The country has the second-largest global road network.

The new toll rates will be implemented from June 3, 2024, according to a senior NHAI official. This annual revision aligns with changes in the wholesale price index (CPI)-based inflation, which influences the user fee adjustments.

Toll Tax Hike: What It Is And Why It¡¯s Collected | Unsplash

India's extensive national highway network features approximately 855 toll plazas. Of these, around 675 are public-funded, while the remaining 180 are operated by concessionaires. The toll hikes are part of an annual exercise conducted under the National Highways Fee (Determination of Rates and Collection) Rules, 2008.

What is Toll Tax?

The toll tax is a charge that vehicle drivers have to pay while crossing certain interstate expressways, national and state highways. They fall under the National Highway Authority of India (NHAI) control. However, there is no toll tax for pedestrians and two-wheelers are exempt from paying toll charges. Opposition parties and several motorists criticise the annual rise in charges, saying they increase transport costs of essential commodities and burden commuters.

Why is Toll Tax Collected?

India has one of the largest roadway networks in the world. Road charges or tolls are collected to ensure funds are available for road repair and maintenance. Therefore, toll stations are set up on roads, and the money collected is used to maintain road quality and improve infrastructure for quicker travel.However, the tolls for each expressway, highway, bridge, or tunnel are not the same.

Toll Tax Hike: What It Is And Why It¡¯s Collected | Unsplash

Toll Tax Rules in India

Although road charges are a good way to ensure the quality of road networks stays up to date, the NHAI has set certain rules for their collection. These rules must be followed before collecting tolls on any road network in India.

READ ALSO: Now You Can Drive Away Without Paying Toll Tax If Waiting Time Exceeds 3 Minutes. No Kidding!

Tax Rates

According to the NHAI, toll rates at any booth must be fixed and the same for everyone. The rate must be determined by the vehicle type, distance travelled, and time of day.

Location

Toll plazas cannot be built at just any spot on the road. They must be constructed carefully to avoid causing excessive traffic or safety concerns. The environmental impact should also be considered before deciding on a location.

Tax Exemption List

Official rules also state that certain categories of vehicles do not have to pay tolls. These include emergency vehicles, military vehicles, and public vehicles.

Collection Methods

Tolls can be collected at any booth in the country through various payment methods, including both physical and digital options. It is important to have the necessary technology in place to collect tolls efficiently and effectively.

These are some of the most essential toll tax rules regarding road charges. They ensure that tolls are collected fairly to maintain road quality and public safety.

READ ALSO: Under NHAI's New Guidelines, No Toll Tax If Queue Exceeds 100 Metres

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