Interstate buses on track for long haul

Luxury long-distance bus manufacturers and operators hope that the all-India permit rules that were modified last year for inter-state buses will boost demand for the segment. Shahkar Abidi reports.

- Shahkar Abidi

Bus manufacturers are banking on a new rule that allows easier inter-state travel permissions to boost demand for buses. In an interaction with Autocar Professional, Akash Passey, President (Bus Division), Volvo Eicher Commercial Vehicles (VECV) said that with schools normally closing around April-May each year for summer vacations, he expects tourism to pick up. He also says that this depends on there being no additional pandemic wave hindering normal movement of people across the country.

It is, however, the regulatory changes in taxation for interstate tourist buses which may lower the costs of a bus for operators and lead to lower fares that he says may help the sector get a much-needed boost.

As per industry rules, the taxes on interstate buses are determined by the number of seats or berths in the vehicles. A back-of-the envelope calculation based on this may help understand the taxstructure for the tourist bus operators vis-a-vis the older one. For instance, when an inter-state bus earlier travelled between Mumbai to Bengaluru covering around 600 kilometers and passing through Maharashtra and Karnataka, both the states levied approximately Rs 28,000 and Rs 59,200 of taxes respectively. However, under the new all-India permit rules, the charges levied by Maharashtra remain the same at around Rs 28,000, but the remaining charges come down drastically to Rs 25,000, thereby cumulatively adding up to just about Rs 53,000 which is a clear saving of nearly Rs 35,000 as compared to the earlier structure.

As an example, if a bus travels from Bengaluru to Hyderabad covering over 700 km, thereby transitioning through Karnataka and Andhra Pradesh before reaching Telangana, the earlier levies that would be approximately total Rs 158,400 would be nearly halved which amounts to a big savings for bus operators especially in current times when pandemic has eaten into their businesses.