Car owners can avail 25% concession on road tax against scrappage certificate

The Ministry of Road, Transport, and Highways has proposed a concession of 25% in road tax against the scrappage certificate of personal vehicles and 15% for transport vehicles. This rule is proposed to come into effect from October 1, 2021 as a part of the newly introduced vehicle scrappage policy.

According to the new notification issued by the ministry, 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% for the non-transport vehicles; and up to 15% in case of transport vehicles. These concessions will be available up to 8 years for transport vehicles, and up to 15 years for private vehicles.

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

The scrappage eligibility of a vehicle will be primarily based on the fitness of the 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.