The Legislative Assembly on Thursday (March 5) passed the AP Motor Vehicle Taxation (Amendment) Bill, 2026, which allows the government to impose 10% road safety cess on vehicles subject to lifetime tax.
It is intended to mobilize financial resources for ongoing road maintenance, remedial engineering, black spot improvements and road safety infrastructure.
Transport Minister Mandipalli Ramprasad Reddy said road safety has become a critical public policy priority due to the high number of road accidents, deaths and injuries in the state.
These accidents were caused by technical deficiencies, insufficient enforcement, poor road geometry and lack of protective structures, insufficient road signs and traffic markings, and the absence of systematic interventions in road safety.
To address these issues permanently and in view of the significant reduction in the cost of vehicles to be paid by buyers due to the reduction of GST on motor vehicles by the Government of India from 28% to 18%, the government decided to mobilize additional revenue by imposing a nominal tax on vehicle owners through an amendment to the AP Motor Vehicle Taxation Act, 1963.
The fee is to be paid at the time of vehicle registration and the bill replaces the AP Motor Vehicle Taxation (Amendment) Ordinance, 2026. It will generate nearly ₹22.50 crore per month to the state exchequer.
Published – 05 March 2026 16:04 IST
