‘Green’ tax mooted for personal vehicles older than 15 years

Owners of old vehicles will have to pay the government a ‘green’ tax as a penalty for polluting the environment, which will be much steeper if you reside in one of the more polluted cities in India.

The Union Minister for Road Transport and Highways Nitin Gadkari has approved a proposal to levy a ‘green tax’ on old vehicles.

Personal vehicles will be charged a tax at the time of renewal of Registration Certification after 15 years. The levy may differ depending on fuel (petrol/diesel) and type of vehicle. The proposal will now go to the States for consultation before it is formally notified. It includes 10-25% of road tax on transport vehicles older than eight years at the time of renewal of fitness certificate.

The proposal on green tax also includes steeper penalty of up to 50% of road tax for older vehicles registered in some of the highly polluted cities in the country. The Minister also approved a watered-down policy of deregistration and scrapping of vehicles, bringing only those vehicles owned by government departments and PSUs and are older than 15 years under its ambit.

‘Effective April 1’

The policy will come into effect from April 1, 2022.

In 2016, the Centre had floated a draft Voluntary Vehicle Fleet Modernisation Programme that aimed to take 28 million decade-old vehicles off the road. A panel of secretaries suggested the scheme may combine a phased regulatory approach for capping the life of vehicles along with stricter emission norms.