Green Tax

The Union Minister for Road Transport and Highways has approved a proposal to levy a ‘green tax’ on old vehicles.
Personal vehicles will be charged a tax at the time of renewal of Registration Certification after 15 years.
The policy will come into effect from April 1, 2022.

Provisions

The levy may differ depending on fuel (petrol/diesel) and type of vehicle.
The proposal will now go to the States for consultation before it is formally notified.
It includes 10-25% of road tax on transport vehicles older than eight years at the time of renewal of fitness certificate.
The proposal on green tax also includes a steeper penalty of up to 50% of road tax for older vehicles registered in some of the highly polluted cities in the country.
Revenue collected from this tax will be kept in a separate account and will be used for tackling pollution, and for States to set up state-of-art facilities for emission monitoring.

Exemptions to Green Tax

Vehicles like strong hybrids, electric vehicles and alternate fuels like CNG, ethanol, LPG etc to be exempted;
Vehicles used in farming, such as tractors, harvesters, tillers etc be exempted;

Positives of Green Tax

It will dissuade people from using vehicles which damage the environment
It will motivate people to switch to newer, less polluting vehicles
Green tax will reduce the pollution level, and make the polluter pay for pollution.

Other proposals

The Ministry also approved a watered-down policy of deregistration and scrapping of vehicles, bringing only those vehicles owned by government departments and PSUs and are older than 15 years under its ambit.
In 2016, the Centre floated a draft Voluntary Vehicle Fleet Modernization Programme that aimed to take 28 million decade-old vehicles off the road.

Source: PIB

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