Govt may impose add. tax to restrict sale of diesel vehicles

15 Sep 2023 CW Team

The government is contemplating the imposition of additional taxes on diesel vehicles in an effort to discourage their sale unless automakers willingly transition away from this fuel source, according to Nitin Gadkari, the Minister of Road, Transport & Highways (MoRTH).

During his address at the 63rd Annual Convention of the Society of Indian Automobile Manufacturers (SIAM), Gadkari revealed his intention to propose a 10% additional Goods and Services Tax (GST) on vehicles powered by diesel. This move is aimed at curbing the use of diesel fuel in India's automotive sector.

Gadkari urged automobile manufacturers to reduce the production of diesel vehicles voluntarily, emphasizing that if such reductions do not occur, the government will resort to increasing taxes. He cautioned that these tax increases could potentially reach a level where selling diesel vehicles becomes considerably more challenging for manufacturers.

This proposed tax measure reflects the government's commitment to environmental sustainability and a shift toward cleaner and more sustainable transportation options. It sends a clear signal to the automotive industry to prioritize the development and production of vehicles that are more aligned with the country's environmental goals. The ultimate goal is to reduce the reliance on diesel fuel and promote cleaner and greener alternatives within the Indian automotive landscape.

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