No entry tax – Karnataka – Sensible judgement.

Wah. I was waiting for this stupidity to end. Thank God for a sensible judge who overruled it. Karnataka forces people to pay entry tax (and it is as steep as 12% for cars/scooters/…) whenever you buy a vehicle outside the state and bring it in. It was the main reason, why I sold my WagonR in Noida, came to Bangalore, and then bought my new car. Add to the woes, the road tax in KA is probably the highest in the country too.

…road tax in the state is supposed to be the country’s highest. Road tax on cars below Rs 5 lakh is roughly around 10.8%, and from above Rs 5 lakh it varies between 13.75% and 17.5%. The tax in New Delhi is 4% and in Kerala it’s 6%. —source

Phew, and now a sensible judge has overruled this. I particularly like the wordings that were used. Beautiful.

Justice Kumar observed that the makers of the Constitution had favoured free movement and exchange of goods throughout India, which is necessary for the economy and for improving living standards of the country. In his 200-page judgment, he noted that Article 301 emphasises that the economic unity of the country would provide the main sustaining force for stability and progress of the political and cultural unity of the country. Justice Kumar pointed out that in the present context of globalisation, privatisation and free economy, the national boundaries and barriers should be sidelined for the benefit of economic development of the world, “If a state’s economy should be prosperous, because of the tax holidays and lower tax rates, it only shows a mature political leadership vibrant tax planning and marshalling resources available in the state. It is worthy of emulation by other states by free flow of trade and commerce from such a state to neighbouring states.”