Separate Nature of Taxes

• GST and road tax are two distinct types of taxes in India.
  
• GST is a central tax levied on the sale of goods and services.
  
• Road tax is a state-level tax imposed for the use of public roads.
  
• They are collected by different authorities for different purposes.
  
• Road tax is not covered under the GST framework.
  

GST Applies on Vehicle Purchase

• GST is levied on the ex-showroom price of the vehicle at the time of sale.
  
• The rate varies by vehicle type, engine capacity, and usage.
  
• It is collected by the central government through the seller.
  
• GST is added to the price before road tax is calculated.
  
• It forms a part of the total cost paid during purchase.
  

Road Tax is Levied Separately

• Road tax is charged by the state government at the time of vehicle registration.
  
• It is independent of the GST component.
  
• The amount is usually calculated on the base price or invoice value.
  
• States may apply a percentage or slab-based rate.
  
• The tax is paid directly to the Regional Transport Office.
  

Billing and Payment Structure

• The invoice from the dealer will show GST and road tax as separate items.
  
• GST is remitted to the central tax authority by the dealer.
  
• Road tax is either paid through the dealer or directly at the RTO.
  
• The separation ensures transparency in the tax breakdown.
  
• Buyers must keep receipts for both taxes for legal compliance.
  

No Input Tax Credit for Road Tax

• Businesses can claim input tax credit for GST paid on eligible vehicles.
  
• However, input tax credit is not available for road tax payments.
  
• Road tax is treated as a statutory cost of ownership.
  
• This distinction is recognized in both state and central taxation policies.
  
• There is no mechanism to adjust road tax against GST liabilities.