Interstate tourist taxi permit fee mafia

If you’re traveling on a rented car (yellow board) and it had to cross a state border, you might remember your driver asking for extra money as permit fee. Almost all states charge a fee for tourist vehicles registered in other states to enter. It is a source of revenue to many states, particularly touristy states and a way of protecting commercial interests of local taxis.

Pay more if you're travelling in yellow board

This post shares some of my observations in this regard.

Different states have different rate structures. While most states offer daily/weekly/monthly charges, some states only offer long term tax (like Himachal Pradesh, which charges Rs 610 for 2 month entry permit- even for a 24 hour visit, one has to pay Rs 610)

The tax rates often depend on how many seats are there in the vehicle. For a 5 seater vehicle (Such as Indica or the likes), permit fee as I know is as below:

• Pondicherry: Rs 28 per day
• Punjab: Rs 200 per day
• UP: Rs 120 per day

RTO checkpost at HP border

Himachal pradesh entry fee for tourist taxi

UP tourist taxi entry permit fee

What happens if you don’t pay the taxes? RTO officials are authorized to seize the vehicle and fine up to 5000/10000 Rs. But this check rarely happens. That is probably because taxi drivers do not have any motive to skip paying the tax, as they pass on the entire burden to their customers. The fear of seizure and fine also forces them not to take any chances. Also if the customers are unsuspecting, a taxi driver might add another 100 Rs to the actual amount, while collecting money from the customers. 

During my 5 day, 5 states, 2000kms road trip in North India, I wasn't ever asked for permit details. While returning to Delhi our car was stopped by Punjab police- they asked me to open the boot, which I complied- we had over a dozen bag and asked if we should open it and show- they just let us through, without asking for permit or checking the bags. I’ve never seen an RTO official asking for permit receipt from a tourist vehicle. (But this is NOT a reason NOT to pay permit fee).

There’re lots of practical challenges in this concept of Interstate permit fee or tax for tourist vehicles (Yellow board):

1. When a state has multiple entry points, a check post or booth to pay entry tax may not be available on all roads that lead to the state. These check posts often exist on main entrances. Taxi drivers are familiar with these points, hence make a point to go through them and pay the tax, but those using unconventional routes may often miss these check posts. It is not fair to expect a driver to always know where exactly is the check post and then drive several of extra kms to visit that post and pay the tax.

While going from Delhi to UP, I was told that the booth to pay UP road tax is located near Anand Vihar bus stand. This meant about 5-6kms detour and 30 mins of extra time (this was at midnight, expect more time in day time). If I was to enter Haryana and then enter UP from a different road, where do I supposed to go to pay the tax? Of course lots of states offer online payment facility for the permit fee.

Similarly, if we're going from Chennai to Tirupati on the conventional route, we find a check post to pay permit fee. But if I am to go to Sriharikota, then to Venkatagiri and then connect to Bangalore-Tirupati road, probability of finding a check post is very low. If there's no place to pay tax on the route I am taking, why should I travel extra, wasting time, fuel etc to pay tax?

2. Lot of time customers end up paying double tax- for example, if we’re going from Delhi to Himachal Pradesh via Punjab, say you start from Delhi on Friday morning, pass via Punjab and reach HP border by evening, spend 24 hours in HP and return to Delhi on Saturday/Sunday- in this process, we’ll have to pay Punjab tax for 2 days (though total time spent in Punjab is less than 24 hours, pay 600 Rs to HP Govt, just to be in for a day etc. I feel this tax should be abolished if a driver can prove that he is only passing through the state and doesn’t intend to stay (such as showing hotel confirmations etc)

3. It is very common for people manning permit booths to demand 50 Rs or so extra than the receipt amount. If questioned, they might let you pay only the receipt amount. At HP border, the guy asked me to enter my name in his computer, because he had left is spectacles back home. As I typed my name, he asked for Rs 650, while the print out showed Rs 600. When I demanded why extra, he pointed to a text which said “Processing fee Rs 10 extra’. Then I paid only Rs 600 and another 10. He murmured something but accepted the money.

4. As a customer, if you go near the officials who print the receipt, you might be asked to go away. This is often a ploy to ensure that you don’t see the receipt amount.

5. If I pay for a day, assuming that I will return before midnight, but a major traffic jam or pathetic roads on the way delays the return, whose fault it is? Is the taxi driver and customers expected to factor such delays and pay for an extra day?

6. Please note that this permit fee amount is in addition to 100s of rupees charged by numerous toll booths.

7. During 2010, when we toured 6 states for over 26 days as a part of Tata Nano superdrive, we had an events team which was going a day ahead of us in a tourist bus. (their task was to reach the next city, prepare for hotel events etc). During 26 days road trip, the bus had to pay Rs 1.6 lakhs in permits and tolls. Yes, it is 1.6 lakh rupees in interstate permit and tolls. (Bus has much more seats compared to a taxi, so permit tax for a bus will be much higher)- this is about Rs 6200 a day OR Rs 27000 per state or Rs 29 per km.

8. Lots of taxi operators arrange white board vehicles for interstate travel, to avoid this hefty permit fee and often expect customers to shell out 50% of the permit fee they ‘saved’ because of this genius arrangement. This is illegal, but very difficult to enforce. Passengers are trained to say “this is our relative’s vehicle” and nothing much can be done to prove otherwise.

9. Tour operators in Mangalore often arrange for alternate vehicles at Kerala border and ask their passengers to get down and board another bus- to save 1000s of rupees otherwise had to be shelled out on interstate permit.

10. The interstate permit tax is applicable to self drive vehicles as well. Bangalore based Zoomcars reimburses AP state permit to its customers, as a policy. Carzonrent doesn’t have such a policy.

11. These days toll and permit fees add up to as much as diesel cost or even greater.

12. When new states are created, travelers burden doubles. Now that Telangana is being created, will AP reduce its permit fee by Half since half of its land is gone? Will Telangana stop charging those who’ve already paid AP entry permit? For no apparent logic, travelers now need to shell out twice the money.

Pondy Entry fee

 13. In hill stations, space is at premium. Lots of parking spaces are grabbed by local taxi unions and outside vehicles are not allowed to park there (see sample image below, clicked in Dharmashala). If an outside taxi pays permit fee, then it should get full access to all parking spaces otherwise illegally protected by local taxis.

14. If I am not using all the seats in the car, I still have to pay full tax. For example, say I've removed last row seats of Innova and made it a luxury 4 seater. Still tax needs to be paid as per RC book. Similarly, even if a taxi driver wishes to go to other state for his personal work or to take his family for an outing, tax still needs to be coughed up.