Govt plans to levy 20 % surcharge on cash payments at Toll plazas

Toll plazas

The government is planning to levy 10-20 percent surcharge on cash payments at Toll Plaza in metro cities, an English Daily reported. This is being planned to decongest the plazas since paying by cash results in long queues.

Toll plazas

The government believes that the extra charge will dissuade people from cash payments and encourage a behavioral shift towards electronic tolling through FASTags.

Currently, e-tolling attracts a discount. Implementing the new system would mean a reversal of the current incentive system. National Highway Authority of India (NHAI) allows a discount on the base rate if a commuter pays the amount digitally.

According to a report in The Economic Times, the surcharge on cash payments will be calculated on the basis of the congestion.

The move is likely to be featured in the new toll policy that is being prepared by the National Highways Authority of India. FASTags that were first introduced in 2014, uses Radio Frequency Identification (RFID)  technology to make direct payments via prepaid or savings accounts linked to the sticker. The name, FASTags is also a play on the fact that the vehicles do not have to stop at a toll for payment and can rush through.

An official told the daily that multiple costs are involved when cash payments are done, including pollution due to the congestion. Then there are also land acquisition costs because the government has to make bigger toll plazas due to the congestion.

However, experts also believe that while electronic tolls are the way forward, the government will also have to address the glitches in the e-tolling system and ensure that the surcharge flows into the NHAI’s purse.

Currently, a 30 percent toll is collected electronically across 400 toll plazas of NHAI. The government aims to make cash transactions lower than 10 percent.

(with inputs from a business magazine)

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