Luxury car tax crackdown in India: Bengaluru Ferrari owner shells out Rs14.2 million

For over a year, a striking red Ferrari SF90 Stradale turned heads on Bengaluru’s streets — until its high-speed run came to an end near Lalbagh on Thursday, when transport officials flagged the Maharashtra-registered supercar for flouting Karnataka’s lifetime road tax regulations.

Valued at ₹75 million, the Ferrari had been operating in the city for over 18 months — far beyond the one-year limit permitted for out-of-state vehicles. Upon verifying that no local tax had been paid, the Bengaluru South Regional Transport Office (RTO) issued a notice warning of possible seizure and legal action.

The owner, a businessman with operations in 55 Indian cities, had registered the car in Maharashtra, where road tax is a flat ₹2 million — significantly lower than Karnataka’s ₹15 million levy for high-end vehicles. To avoid seizure, he promptly paid ₹14.1 million in tax and penalties on the same day.

“This is among the largest single-vehicle tax recoveries we've made in recent times,” said an RTO official, adding that enforcement against luxury car tax evasion will continue.

According to Hindustan Times, this incident comes after a significant operation in February, during which authorities seized 30 luxury vehicles — including Ferraris, Porsches, Audis, Aston Martins, and Range Rovers — over unpaid taxes. The drive involved more than 40 officials and resulted in the recovery of tens of millions of rupees in outstanding dues.

Officials clarified that, under the Motor Vehicles Act, any vehicle registered outside Karnataka but used in the state for more than 12 months is legally required to pay lifetime road tax.

“Regardless of where it’s registered, if a vehicle is being driven here beyond the allowed period, tax must be paid,” an official said.

This crackdown is part of Karnataka’s broader strategy to tackle road tax evasion among luxury vehicle owners. A similar enforcement campaign in March brought in over ₹400 million in unpaid taxes. Authorities say more operations are planned, with several suspected violators already under watch.

The Bengaluru case echoes a similar 2021 crackdown in Hyderabad, where 11 luxury cars — including Rolls-Royce, Lamborghini, and Maserati — were seized for tax violations. Those vehicles, registered in low-tax states, were being driven in Telangana without paying local dues. That operation generated revenue of ₹30 to ₹80 million for the Hyderabad RTA.