New vehicles registered against scrapped ones to get road tax rebate

The state governments and union territory administrations will have to give rebates in road taxes, 15% for commercial vehicles and 25% for personal vehicles from April 2022 for the new vehicle's registration against the scrapped ones.

The Ministry of Road Transport and Highways has issued a notice with the provision aimed at encouraging people to scrap their old polluting vehicles.

As per the official notification, the concession of road taxes will be available for eight years for commercial vehicles and 15 years for personal vehicles. Road Transport and Highways Minister Nitin Gadkari announced the scheme on 17 August.

According to the sources, the states will have the freedom to offer a concession. It will bring more registrations of new vehicles, and the state will not lose any revenue for giving the discount.

The government has also notified a complete waiver of the registration fee for buying new vehicles in place of the old ones. Although the registration fee is not high, it will be another soft incentive for scrapping old vehicles.

The Ministry of Road Transport and Highways has urged the vehicle manufacturer to offer a 5% discount on new vehicles against producing a valid scrapping certificate.

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