IndiaTech and Consumer VOICE have recommended a ‘One Bharat, One Road Tax’ framework to address differences in state-level vehicle taxation, concerns over double taxation and difficulties in interstate vehicle transfers.
The recommendation forms part of the Ease of Vehicle Ownership Index 2026, which assessed ownership transfer procedures across 15 states representing more than 85% of India’s organised used-car market.
According to the report, vehicle owners transferring vehicles between states can face a mismatch between the road tax payable in the destination state and the refund available from the originating state. The destination state calculates tax according to its applicable rates and vehicle age or value, while the originating state follows its own refund schedule.
The study identified Andhra Pradesh and Telangana as the only two states assessed where functional road tax refund mechanisms could be confirmed. Survey findings indicated processing times of 15–30 days and reported refund amounts of approximately 80–90% through demand drafts. Telangana was identified as a benchmark, with turnaround times of 15–20 days.
In West Bengal, Uttar Pradesh, Haryana and Bihar, respondents reported an absence of functional refund pathways. In Rajasthan, Punjab, Gujarat, Karnataka, Madhya Pradesh and Delhi, the study found that refund provisions existed on paper but were difficult to access in practice.
The report also identified a repeat transfer tax in Rajasthan, reportedly ranging from 10% to 25% of the original registration tax on ownership changes, adding to the cost of resale transactions.
Under its national road tax standardisation recommendation, the report proposes transitioning towards a unified framework described as ‘One Bharat, One Road Tax’ to address interstate taxation differences and simplify vehicle movement across states.
The study separately recommends a standardised digital road tax refund module within the Parivahan ecosystem. Drawing on Telangana’s framework, it suggests that the Ministry of Road Transport and Highways consider a common system with defined refund calculations and time-bound processing.
The reform roadmap proposes a 14-day turnaround for road tax refunds through a standardised central digital system.
India’s pre-owned vehicle market is projected to grow from $36.4 billion in 2025 to $73.5 billion by 2030, with annual sales volumes expected to increase from 5.9 million to 9.5 million vehicles, according to industry projections cited in the report.