Toll Collection Soon to Be GPS-based

Mr Nitin Gadkari, the Minister for Road Transport and Highways in India, announced on Thursday that all physical toll booths in the country would be removed within the next year. The government plans to bring in GPS-based toll collections, where the money will be collected based on GPS imaging.

Mr Gadkari said that 93% of vehicles now pay toll using FASTags, but 7% are still yet to adopt it. The government has mandated that a double toll be collected from vehicles that pay without a FASTag. A policy inquiry has been ordered into such vehicles that do not pay toll using FASTags, citing toll theft and GST evasion cases. The benefit of using FASTags is that it facilitates the electronic collection of toll and seamless vehicles’ seamless flow through toll plazas.

“I want to assure the House that within one year, all physical toll booths in the country will be removed. It means that toll collection will happen via GPS. The money will be collected based on GPS imaging”, Mr Gadkari announced in the Lok Sabha during Question Hour.

The minister also spoke about the vehicle scrapping policy, which had been previously mentioned in the Union Budget 2021-22. The scrapping policy is said to reduce pollution and improve fuel efficiency. Fitness tests will be carried out for privately-owned vehicles after the completion of 15 years and after 20 years for commercial vehicles. 

A vehicle that fails this fitness test may be declared as an End of Life Vehicle. Vehicle owners will also get strong incentives to scrap old and unfit vehicles. The automobile sector is said to see an increase in turnover from Rs.4.5 lakh crore to Rs.10 lakh crore with this new policy’s introduction.

For any clarifications/feedback on the topic, please contact the writer at athena.rebello@cleartax.in

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