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Centre plans ‘green tax’ for older vehicles

Union Road Transport and Highways Minister Nitin Gadkari has approved the proposal and the centre has sent it to the states for consultation after which it will be notified.

By: Express News Service | New Delhi |
January 26, 2021 2:23:10 am
Differential tax will also be charged depending on fuel (petrol/ diesel) and the type of vehicle.

The Centre plans to notify a system of imposing “green tax” on older vehicles in a move to disincentivise the use of polluting vehicles, and to curb pollution in the country.

Union Road Transport and Highways Minister Nitin Gadkari has approved the proposal and the centre has sent it to the states for consultation after which it will be notified.

Vehicles like strong hybrids, electric vehicles and those running on alternate fuels like CNG, ethanol and LPG will be exempted while the revenue collected through the green tax will be utilised for tackling pollution, the Ministry of Road Transport and Highways said in a statement on Monday.

“The Union Minister for Road Transport and Highways Nitin Gadkari has approved a proposal to levy a ‘green tax’ on old vehicles which are polluting the environment,” it said in a statement.

Transport vehicles older than eight years could be charged green tax at the time of renewal of fitness certificate at the rate of 10 to 25 per cent of road tax.

Personal vehicles are proposed to be charged green tax at the time of renewal of registration certification after 15 years; public transport vehicles, such as city buses, will be charged lower green tax; higher green tax (50 per cent of road tax) will be levied on vehicles being registered in highly polluted cities, the government statement said.

Differential tax will also be charged depending on fuel (petrol/ diesel) and the type of vehicle.

Apart from strong hybrids, electric vehicles and alternate fuels like CNG, ethanol, LPG etc, vehicles used in farming, such as tractor, harvesters and tillers will be exempted from the tax, the statement said.

According to the ministry, the revenue collected from the green tax will be kept in a separate account and will be used for tackling pollution.

Listing the benefits of the green tax, the ministry said that it will dissuade people from using vehicles which damage the environment and motivate them to switch to newer, less polluting vehicles. “Green tax will reduce the pollution level, and make the polluter pay for pollution,” it added.

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