It is ridiculous to extract toll taxes from vehicles in traditional models like manual toll correction when we are living in the digital century. Many challenges are faced under the traditional model, such as congestion, delays, high operational costs, maintenance of staff, economic impacts, environmental impacts, and most importantly, the privacy of vehicles. To deal with all the problems in the conventional toll tax collection methodology, a new approach to toll tax collection using vehicular ad hoc networks and cryptography has been proposed, known as an identity-based toll tax collection system using Geohash (IBTTCS), which is privacy-preserving. Our method reduces the need for human intervention by incorporating an automated vehicle identification method using identity-based cryptography and Geohash which optimizes the toll tax collection process. This advanced method enhances efficiency and ensures the proper management of transactions.