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Thread: Cess for Roads and Tolls on Roads...

  1. #1
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    Cess for Roads and Tolls on Roads...


    I think since 2000 or 2001, we are paying Re. 1.00 per litre of Petrol and Diesel, as Road Cess for building better Highways and Roads.

    Can anyone inform me as to which authority collects this tax and who is responsible for the "administration", "disbursal" and "proper use" of these collections for the last 8 years or so.

    Can I get a account of all the "cess" collected for last 8 years and how it was spent ?

    The reason being that inspite of all the "road cess" collected, most of the new roads being built are charging a "toll" for usage, irrespective of whether they are on BOT basis or just a expansion or widening of a existing road. "Tolls" are also being collected on some bridges.

    Which PA to address my querry for information ?



  2. Re: Cess for Roads and Tolls on Roads...


    Quote Originally Posted by karira View Post
    Which PA to address my querry for information ?
    As per a news report in The Hindu that appeared two years ago, road cess revenues accrue to National Highways Authority of India. Other than this , there are certain state governments (like Karnataka) which have introduced a road cess of 10% on select commodities to enhance their revenue.

    If you dig deep into it, every other state govt will be having this source under one guise or the other. It is possible that you may end up with an RTI application on each state besides the centre.
    Defeat is not final when you fall down. It is final when you refuse to get up.

  3. #3
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    Re: Cess for Roads and Tolls on Roads...


    Ok, got a brief idea about this:

    1. There is something called the "Consolidated Road Fund" established in 2000.
    2. Original cess was Re. 1.00 per litre of diesel and petrol.
    Increased by Re. 0.50 twice in later years. So now we pay Rs. 2.00 per litre.
    3. Sharing mechanism as per "formula" has been established between centre and states.
    4. Governing authority is MINISTRY OF SHIPPING, ROAD TRANSPORT & HIGHWAYS,<o></o> DEPARTMENT OF ROAD TRANSPORT & HIGHWAYS. CPIO details available.

    Will draft a application and then post here for more inputs.

  4. Re: Cess for Roads and Tolls on Roads...



    Good luck & best wishes
    Defeat is not final when you fall down. It is final when you refuse to get up.

  5. #5

    Re: Cess for Roads and Tolls on Roads...


    Thanks. That is a very good effort.

  6. Re: Cess for Roads and Tolls on Roads...


    Good Luck karira
    RTI India Network Staff Member

  7. Re: Cess for Roads and Tolls on Roads...


    Karira ji,

    very good work you have choosen, you can post your application here, we will definately simultaniously file such application on different parts of the country and can find out how public money has been either used or misused.

    best of luck karira ji,

    rakatkam.

  8. #8
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    Re: Cess for Roads and Tolls on Roads...


    As reported by Pioneer News Service on dailypioneer.com on 23 February 2008:
    The Pioneer > Home

    After looting commuters, toll plazas offer share to Govt

    <table border="0" cellpadding="0" cellspacing="0" width="450"><tbody><tr><td class="news"><table border="0" cellpadding="0" cellspacing="0" width="450"><tbody><tr><td class="news" colspan="2" valign="top"> Cash registers seem to be ringing for private firms involved in highway development and upgradation projects. The developers have offered to pass on 17 to 48 per cent of toll collection to the Government, an obvious indication they are making more than enough profits. The common man seems to have got the raw deal because he is paying those exorbitant toll charges along with petrol cess for road repair and maintenance.
    </td> </tr> </tbody></table></td> </tr> <tr> <td class="news" colspan="2" valign="top">
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">The first official suggestion that the road sector is becoming a booming market for private developers came on Friday as the Ministry of Shipping, Road Transport and Highways declared how five prime six-laning projects had been awarded. The projects, that involve upgradation of four-lane highways to six-lane, have been awarded on a new Model Concession Agreement (MCA) under which the Ministry has moved away from positive or negative grants and switched to sharing of toll revenue.
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">The response to this new MCA, as Secretary (Road Transport and Highways) Brahm Dutt puts it, has been 'overwhelming'. On four of the five projects awarded, viz. Chennai-Tada, Gurgaon-Kotputli-Jaipur, Surat-Dahisar and Panipat-Jalandhar, the private developers have offered to pass on 17.07 per cent, 48.06 per cent, 38 per cent and 20.14 per cent respectively of toll collection to the Government. The only exception is Chilkaluripet-Vijaywada in which the Government would get 2 per cent of the toll collection only after 4.65 years.
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">The good news for the Government does not end here. The money would start rolling in even without the completion of the project. Within 180 days of signing of the agreement with the private developer, the Government would start getting its share, which would only increase during the concession period.
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">The authorities were, however, silent on why the toll charges could not be brought down and relief passed on to the road users instead of the developers and the Government entering into an unholy nexus to fleece them.
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">The response from private developers is understandable as the Government would allow them to charge a toll tax even before they would complete the project. They would take 30 months to complete a project but would be allowed to charge a toll tax and share revenue with the Government within 180 days of signing the agreement with the Government. End result: The Government would get a good share despite the private developer not delivering a six-lane highway to the people.
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">The Ministry, however, has a justification for this loot. Dutt explained: "There will be no increase of toll tax. We are already charging the people a toll tax because these are four-lane highways.
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">So, all the private developer needs to do is integrate the system of revenue sharing for a six-lane project with the present system."
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">This gives rise to an obvious question: If the business is so lucrative, why is the Government charging a cess on petrol and diesel in the name of upgradation and construction of highways? Isn't this another form of double taxing people? The Ministry is unlikely to stop at just awarding of five contracts. The five projects account for 882 km of the 6,500 km National Highways Development Programme (NHDP) Phase V. It is all set to award contracts for six-laning of another 495 km of highways. The feasibility reports of 1,493-km of 10 highway stretches are being prepared.
    </td> </tr> <tr> <td class="news" colspan="2" valign="top">
    </td></tr></tbody></table>

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