Revenue collected through the tax will be used for tackling pollution
Tractors, hybrid, electric vehicles exempted from Green Tax
New Delhi: The Union Minister for Road Transport and Highways Nitin Gadkari on Monday approved a proposal to levy a “Green Tax” on old vehicles which are polluting the environment.
The proposal will be referred to the states for consultation before it is notified, an official statement said.
As per the official statement ‘Transport vehicles older than 8 years could be charged Green Tax at the time of renewal of fitness certificate, at the rate of 10 to 25 % of road tax. Personal vehicles to be charged Green Tax at the time of renewal of Registration Certification after 15 years and Public transport vehicles, such as city buses, to be charged lower Green tax, the statement further read.
It’s also decided to impose higher Green tax (50% of Road Tax) for vehicles being registered in highly polluted cities. The tax will be different depending on fuel (petrol/diesel) and type of vehicle.
However, vehicles like strong hybrids, electric vehicles and alternate fuels like CNG, ethanol, LPG etc proposed to be exempted from the Green Tax.
Vehicles used in farming, such as tractor, harvestor, tiller etc are also proposed in the exempted list.
To ensure best use of the funds collected from the Green Tax, tax revenue to be kept in a separate account and used for tackling pollution, and for States to set up stateof-art facilities for emission monitoring
The Minister also approved the policy of deregistration and scrapping of vehicles owned by Government department and PSU, which are above 15 years in age. It is to be notified, and will come into effect from 1st April, 2022.
It is estimated that commercial vehicles, which constitute about 5% of the total vehicle fleet, contribute about 65-70% of total vehicular pollution. The older fleet, typically manufactured before the year 2000 constitute less than 1 % of the total fleet but contributes around 15% of total vehicular pollution. These older vehicles pollute 10-25 times more than modern vehicles.