Lifetime tax switch option for private car owners, relaxation on buyers' pocket
Telegraph | 27 December 2025
Buying a new car in the state has long involved a choice between paying road tax for five years or opting for a lifetime tax. While the lifetime option is cheaper in the long run, many buyers — already strained by the cost of a new vehicle — end up choosing the five-year tax.
The government has now opened a window for such vehicle owners to reconsider that decision.
In a recent notification, the transport department said a private car owner would be allowed to switch to the lifetime road tax regime while renewing road tax at the end of the initial five-year term. A new buyer can also opt to shift to the lifetime tax within 15 days of purchasing the car, even after paying the five-year road tax.
Earlier, the choice between lifetime and five-year tax could be made only at the time of vehicle registration. There was no provision to switch later.
“There have been multiple appeals from new car owners who said they realised only after buying a vehicle that paying lifetime tax makes more sense financially than renewing road tax every five years,” said a senior transport department official. “The government has now decided to give them the option to switch by paying the residual amount.”
Officials said car dealers often fail to explain the long-term savings associated with lifetime tax. “Dealers are usually in a hurry to close the sale and do not explain the difference between five-year and lifetime road tax,” the official said.
Paying road tax to the state government is mandatory for anyone buying a new vehicle. While immediate budget constraints may compel buyers to opt for the five-year tax, transport department officials said the lifetime tax offers clear advantages.
Under the West Bengal Additional and One-Time Tax on Motor Vehicles Act, 1989, a private vehicle with an engine capacity of more than 900 cc but not exceeding 1490 cc attracts a five-year road tax of either ₹25,000 or 5.5% of the vehicle’s value, whichever is higher. The lifetime tax for the same category of vehicle is either ₹55,000 or 10% of the vehicle’s value, whichever is higher.
If a vehicle owner chooses to switch to the lifetime tax regime at the end of the five-year period, the tax will be calculated at 7.5% of the vehicle’s value, senior officials said.
“There is no expiry date for lifetime tax. Once it is paid, it remains valid for as long as the vehicle is on the road,” the official said.
How to apply
To make the switch, a private vehicle owner must apply to the registering authority seeking permission to move from the five-year tax to the lifetime tax regime. The authority will assess the vehicle’s tax history, calculate the residual amount payable and inform the owner. The payment must be made within 30 days.
Officials added that the move could also benefit owners of older vehicles. “There is no clearly stated policy on the fate of 15-year-old privately owned vehicles. Many want to retain well-maintained cars. Such owners, too, can opt for lifetime tax,” the official said.