MM Farooqui Hyderabad

Hightaxes in Telangana are prompting private transport and tourist bus operators to register their vehicles in other states and Union Territories, where the tax burden is comparatively lower. The trend was particularly visible during the Dasara festival rush, when a majority of private and tourist buses operating in the city were found to be registered outside Telangana.

Annual motor vehicle tax and quarterly taxes in Telangana are reportedly driving transport agencies to purchase and register contract carriage buses in other jurisdictions, particularly Union Territories that levy lower charges.

Buses operating from Hyderabad to other districts and states were seen carrying registration numbers from Nagaland (NL), Odisha (OD), Arunachal Pradesh (AR) and Puducherry (PY), among others.

According to transport agencies, operators are choosing these jurisdictions to reduce their financial burden. After completing the required formalities, they bring the buses to Telangana and operate them under the applicable All India Tourist Permit (AITP).

A representative of a transport agency said, “The taxes and fees in Telangana are a significant financial burden for operators. Registering buses in other states or Union Territories with lower charges reduces the burden. We would prefer to register our vehicles in Telangana if the government offers a lower tax structure.”

Another transport representative said purchasing buses in other states was not their first choice, but operating costs remained a major concern. A reduction in the tax burden, the representative said, could encourage operators to register more buses in Telangana and provide relief to the transport sector.

Meanwhile, official sources said the Telangana Transport Department was considering measures to reduce taxes on contract carriage buses. Transport Commissioner K Ilambarthi has sent a proposal to the State government, which is under consideration.

The department has proposed reducing the quarterly tax on AITP buses from Rs 4,000 to Rs 1,800 per seat. Union Territories charge less than Rs 500 per seat in quarterly tax, while several neighbouring states levy between Rs 1,800 and Rs 3,000, making them comparatively cheaper than Telangana.

If implemented, the proposed reduction could ease the financial burden on transport agencies and encourage operators to purchase and register more buses in the State.

Sources said Telangana has only 110 AITP-registered buses. The movement of buses to other states and Union Territories was particularly noticeable in 2023, when 68 buses moved out of Telangana. Another 15 buses shifted in 2024 and 13 in 2025.

The buses obtained no-objection certificates to transfer their registrations to Nagaland, Andhra Pradesh, Arunachal Pradesh and other states and Union Territories.