Govt proposes 25% road tax concession to car owners against scrappage certificate


The Ministry of Road, Transport, and Highways (MoRTH) is proposing concession of 25 per cent in road tax against the scrappage certificate of personal vehicles and 15 per cent for transport vehicles. As a part of the newly introduced vehicle scrappage policy, this rule is proposed to come into effect from October 1 2021.

According to the notification issued by the MoRTH, in case a new vehicle is registered against the submission of, certificate of vehicle scrapping, it can avail a concession in the motor vehicle tax up to 25 per cent for the non-transport vehicles and up to 15 per cent in case of transport vehicles. These concessions will be available up to eight years for transport vehicles, and up to 15 years for private vehicles, as the notification further said.

The transport ministry has invited suggestions from the stakeholders on the draft rules over the next month, after which it will issue the final notification.

Earlier this month the union transport minister Nitin Gadkari unveiled the much-awaited vehicle scrappage policy that is aimed at creating at phasing out the unfit and polluting vehicles. The policy is also claimed to be creating demand in the auto industry, besides helping in reducing vehicular pollution. Also, it is claimed to be creating a lot of jobs.

While announcing the policy, Gadkari said the vehicle owners scrapping their old vehicles, could get strong incentives including a 25 per cent rebate on road-tax for personal vehicles, and 15 per cent for commercial vehicles. He also said that there would be a five per cent discount on purchases of a new vehicle against the scrapping certificate, among other benefits. The latest notification by the ministry comes in the line with that.

The scrappage eligibility of a vehicle will be primarily based on the fitness of vehicles through the automated fitness centres in case of commercial vehicles and non-renewal of registration for the private vehicles.

As the vehicle scrappage policy has proposed, the commercial vehicles will be deregistered after 15 years in case of failure to get the fitness certificate. Also, in order to promote the scrappage policy, the ministry has proposed increased fees for fitness certificate and fitness test for commercial vehicles older than 15 years.

According to the current rules and regulations, a private vehicle be it a car or two-wheeler is issued a registration certificate which is valid for 15 years. Thereafter, the car gas to be taken to a RTO for a fitness test. Once the car is deemed fit a fitness certificate is granted for five years after which the vehicle has to go through the same test again.

According to the new Vehicle Scrappage Policy, the process of getting a fitness certificate will become far more stringent. Automated workshops will spring across the country and one has to ensure that the vehicle taken to these centres are properly fit. This is primarily because human intervention will be drastically reduced and computers will take charge. For example, if the vehicle on the test bed has misaligned headlamps or if the headlamps are not powerful enough, the computer will give it a ‘fail’.

The moment the vehicle fails on any of the important parameters, a fitness certificate will not be provided. According to latest statements, vehicles which fail, will be deemed End of Life Vehicle (EOLV). Then the owner will be given an option to scrap the vehicle at a registered vehicle scrapping facilities. HT Auto