Motor Vehicles Tax in India is imposed by state governments. It is calculated on the basis of various factors including engine capacity, seating capacity, unladen weight and cost price.
Road tax, known by various names around the world, is a tax which has to be paid on a motor vehicle before using it on a public road.
The Motor Vehicle Tax is charged on the basis of the category to which a vehicle belongs. The motor vehicles are not only clearly differentiated by their design and carrying capacity but they are also categorized as Commercial and Non-Commercial types.
In India, road tax is imposed by both the central (customs duty,Central excise, and central sales tax), state government (motor vehicles tax, passengers and goods tax, state VAT, and toll taxes) and local bodies (octroi).