Delhi may soon offer Motor Vehicles Tax concession for scrapping old vehicles

Scrapping old vehicles in Delhi could soon help you reduce Motor Vehicles Tax on purchase of a new one. The Delhi government has prepared a proposal which, if approved, could save up to 20 per cent of tax on registration of a new vehicle. The state government has sent the proposal to VK Saxena, Lieutenant Governor of Delhi, for his approval. The move is aimed to reduce number of polluting vehicles from the roads of the national capital.

In its proposal, the Delhi Government promises to offer concession on Motor Vehicles Tax for registration of new transport and non-transport vehicles. This concession will be offered if the buyer produces a certificate from a Registered Vehicles Scrapping Facility (RVSF) verifying his or her old vehicle has been received for scrapping.

Kailash Gahlot, Transport Minister of Delhi, said that the government hopes the proposed tax sop will help vehicle owners to shift to more environment-friendly vehicles like electric vehicles or alternative fuel. The Delhi government has warned to crack down on usage of old vehicles which cause pollution. It recently issued a new set of guidelines according to which, any car that is found to be older than the permissible limit and still moving around in the city will be impounded and the owner will be slapped with a ₹10,000 penalty before the vehicle is released. The penalty amount is set at ₹5,000 for ageing two-wheelers.

Speaking on the proposal to encourage vehicle scrapping, Gahlot said, “For non-transport vehicles, the concession includes a 20 per cent reduction in the Motor Vehicles Tax payable on the registration of new petrol, CNG, or LPG vehicles, and a 15 per cent reduction for new diesel vehicles. For transport vehicles, the concession includes a 15 per cent reduction in the Motor Vehicles Tax payable on the registration of new petrol, CNG, or LPG vehicles, and a 10 per cent reduction for new diesel vehicles." He has also clarified that the overall Motor Vehicles Tax sop will not exceed 50 per cent of the scrap value.

What is Vehicle Scrapping Policy

To remove polluting vehicles from the roads, the central government came up with a vehicle scrappage policy which offers incentives for owners who bring their old vehicles for scrappage. In Delhi, a vehicle owner cannot use a petrol car which is more than 15 years old or a diesel vehicle if it is past 10 years. The Centre and some of the vehicle manufacturers have set up multiple vehicle scrappage centres where one can send old vehicles. Alternately, such vehicle owners can also get their vehicles tested at authorised centers and renew fitness certificate to be able to drive it.

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