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What is Toll Tax, and What are the Rules?

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Created on
May 10, 2023

Summary

What’s Inside

Toll tax is a user fee for vehicles using certain roads or bridges. It is a mechanism that generates revenue to finance the maintenance and upkeep of the infrastructure. Toll tax collection typically occurs at a designated toll plaza or toll booth. This revenue generated through toll tax collection is used to cover the costs associated with the maintenance and operation of these roads and bridges. However, there are certain vehicles, such as ambulances, police cars, fire trucks etc., that are exempted from toll tax.

What is Toll Tax

The National Highway Authority of India (NHAI) imposes toll taxes for specific roads or bridges. Toll tax is a means to generate funds for repairing and maintaining infrastructure. The toll tax rate is determined based on several factors, including the type of these rates vehicle, distance travelled, and the time of day. The NHAI fixes t and may vary depending on the type of road and the specific toll plaza. By paying toll taxes, road users contribute to the maintenance and upkeep of these critical pieces of infrastructure.

Toll Tax Rules

The following are some of the most important toll tax rules and regulations:

Toll Rates

Toll charges should be fixed equitably and reasonably for all users. Rates should be determined by vehicle type, distance travelled, and time of day. Toll rates should be evaluated regularly to remain reasonable and balanced.

Toll Plaza Location

Toll plazas should be positioned so they don't cause excessive traffic or safety issues. The location of the toll plaza should be chosen with issues such as traffic density, security, and environmental impact in mind.

Exemptions and Discounts

Some vehicle types, including emergency response, military, and public transportation, may not be subject to toll tax. Additionally, discounts could be given to locals or regular customers.

Toll Collection Methods

Toll tax can be collected through various methods, including cash or electronic toll collection systems. Toll booths should have the necessary technology to collect toll tax efficiently and securely.

Benefits of Toll Tax

Here are the key features & benefits of toll tax:

Revenue Generation

Tolls are a significant source of government financing, which may be used to pay for road development projects, road maintenance and repair, and other related operations.

Improved Road Safety

Toll earnings may be utilised for road safety measures such as enhanced lighting, signs, and road markings, which can help minimise road accidents and fatalities.

Reduced Environmental Impact

Toll taxation can assist in minimising the environmental effect of road traffic by promoting public transport and carpooling through toll reductions.

Conclusion

Tolls offer an impartial and effective method of generating funds for new road construction and maintenance, providing dependable and safe transport for all road users. Along with paying your toll, managing your other personal expenses is also important.

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Frequently Asked Questions

1. What is the rule of toll tax in India?

The National Highways Fee (Determination of Rates and Collection) Rules, 2008 regulates toll tax rules in India. Toll tax rates are determined by the criteria based on the kind of vehicle, distance travelled, and road type.

2. What is the 10-second rule in the toll plaza?

The 10 seconds rule states that no tolls will be collected from vehicles if the waiting queue exceeds 100 metres or it takes more than 10 seconds to pass to the toll booth.

3. Who is exempt from toll taxes in India?

Here is the list of vehicles that are exempted from toll tax:

  • Emergency services vehicles such as fire brigades, ambulances, and police vehicles.
  • Defence forces vehicles such as the navy, army, and air force.
  • VIP vehicles
  • Public transport
  • Two-wheelers

4. Is toll-free for local residents?

According to the current law, owners of vehicles who reside within a 20 km radius of a toll plaza on a national highway may request a waiver of the toll fee upon applying and all required supporting documentation, including residence verification.

Disclaimer

Fi Money is not a bank; it offers banking services through licensed partners and investment services through epiFi Wealth Pvt. Ltd. and its partners. This post is for information only and is not professional financial advice.
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