Chennai: Kerala motor vehicle department's crackdown on luxury vehicles registering elsewhere to save on road tax has led to a slide in registration revenue for Puducherry. The registration of luxury cars came down by half in the union territory last month. Not even a single luxury car bought in Kerala was taken to Puducherry to get registered at a lower tax rate in November.
The rich and famous had been getting their expensive cars registered in Puducherry to take advantage of the union territory's lower tax rate. The Kerala government launched a drive to locate the vehicle owners who managed to register their vehicles in Puducherry by providing fake local addresses. Cases have been registered against many offenders.
The Puducherry government registered less than 10 vehicles with a price tag of over Rs 1 crore last month, only half the number it used to receive before the crackdown in Kerala.
The Kerala transport department officers who investigated the trend had recommended the state government to set a deadline for those who evaded taxes in Kerala to get their vehicles re-registered in Kerala. The state is expected to receive at least Rs 100 crore from this step.
Vehicles less than a year old will have to pay the entire road tax when they are re-registered in Kerala. Older vehicles will be allowed a 7 per cent discount.
The motor vehicles department had served notices to several people, including actor-turned-politician Suresh Gopi, for alleged tax evasion by registering their vehicles in the Union Territory even though they are living in Kerala.
The difference of luxury vehicle tax in Kerala and Puducherry is huge and several rich people had filed forged documents to get their cars registered in the UT.
The tax rate in Kerala for luxury cars costing Rs 20 lakh and above is 20 per cent while it is much less in Puducherry.
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