K-P set to impose new road user tax

While the imposition of a new tax policy might be just another fiscal decision made by legislators sitting comfortably in an air-conditioned office, its jolts are felt worst by those low-income citizens, who were barely an inch away from sinking into inescapable poverty.

Recently, in an apparent attempt to boost revenue generation, the Khyber Pakhtunkhwa (K-P) government announced its plans to impose the “Road User Tax”, which will allegedly be levied against all new vehicles operating on roads in the province holding registration numbers from Punjab, Sindh, Islamabad Capital Territory (ICT) and Balochistan.

Opposing this new policy were locals like Shahid Khan, a fruit dealer, who felt that this would only add to the financial woes of the common household. “We are already overburdened by electricity, gas, water bills and property taxes on our houses. During the past three years, bills and inflation have crushed citizens, leaving them in a miserable state. Now, the government is expecting us to pay a new tax just for driving on the roads. This move will force people to leave the province,” protested Shahid.

Likewise, Khalida Begum, a lecturer at a university in Peshawar also highlighted the struggles of the salaried class to run a household. “This new tax will be the last straw on the camel’s back. Instead of giving relief to people in such an economic situation, the government has decided to levy more taxes,” regretted Khalida.

“The province is already burdened with taxes due to which factories are closing down and industry is at a standstill. In these circumstances, such steps need to be taken very thoughtfully. A comprehensive plan should be made with the federation, which takes the people’s convenience into consideration. Taxation is successful only when the common people are getting some relief,” opined Shahid Khan, former Vice-President of the K-P Chamber of Commerce and Industry.

According to the information received by the Express Tribune, the provincial government’s latest decision to impose a new tax came in light of the conclusion that very few vehicles in the province were registered in K-P, and the majority were paying their annual token tax to the other provinces, due to which K-P’s revenue generation had come to a standstill. In fact, the K-P Excise Department has been able to register only 1,23,420 cars and government vehicles, 41,197 commercial passenger vehicles, 48,691 commercial loading vehicles and about 10,00,000 motorcycles, all of which constitute only about 25 to 30 per cent of the total vehicles plying in the province.

Sources further revealed that the Excise Department of Khyber-Pakhtunkhwa (K-P), had sent two options for amending the Road Tax Act to the provincial government. The first option was to collect lump sum road tax, while the second was the re-registration of vehicles with number plates from other provinces. Since the re-registration of millions of vehicles would require check posts, blocking of vehicles, and space for them to park, the Road User Tax seems more likely to be finalized and approved by the Cabinet.

The Express Tribune made an attempt to contact the Excise Minister, Khaleekur Rehman regarding the new road tax, but the correspondent was unable to get a response.