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Govt Approves New Green Tax On Older Vehicles: What Is It And What Are People Saying About it

Modified On Jan 26, 2021 07:39 PM By Sonny

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New tax will be higher for vehicles to be registered in highly polluted cities like the capital

The challenge of tackling vehicular pollution is one faced by most developed and developing nations and they are trying a variety of approaches. On January 25, Union Minister for Road Transport and Highways Nitin Gadkari approved the proposal to levy a “Green Tax” for older vehicles which are considered to be more polluting.

The Green Tax proposal suggests different charges be levied as per the vehicle purpose. Here’s a quick breakdown of how it would affect personal vehicles:

  • Cars older than 15 years would be charged a Green Tax at the time of renewing their fitness certificate.

  • The applicable tax rate would be calculated on the basis of road tax and would vary depending on the type of vehicle and which fuel it uses (petrol or diesel).

  • It states that vehicles registered in highly polluted cities will be levied higher Green tax as much as 50 per cent of road tax.

Meanwhile, public transport vehicles are to be charged lower Green Tax and transport vehicles will be charged at the time of renewal after 8 years.

There are also a few exemptions listed in the Green Tax proposal:

  • Strong hybrids, EVs and vehicles that run on alternative fuels such as CNG, LPG and ethanol. 

  • Vehicles used in farming such as tractors, harvesters and tillers.

The revenue collected as Green Tax is said to be kept in a separate account that would be used for “tackling pollution” and for states to monitor their emissions using the latest technology. This announcement also included the approval of a scrappage policy for government vehicles older than 15 years which is slated to come into effect from April 2022.

While this announcement has been somewhat overshadowed by other current events, including the Republic Day celebrations, the initial public response is mostly skeptical at best. Many are critical of the government’s plan to add another tax while the economy is still feeling the effects of the pandemic along with fuel prices reaching new highs in various states. Here are some of the public comments on the topic of the new Green Tax:

Only a few have shown support for the new Green Tax proposal as of now, appreciating the initiative and its intended purpose.

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