Delhi Government Proposes Tax Concession for Scrapping Old Vehicles

The Delhi government has proposed a tax concession for scrapping old vehicles, awaiting approval from Lt Governor VK Saxena. This policy, aimed at promoting the use of cleaner vehicles, offers significant Motor Vehicles Tax reductions for new vehicle registrations when an old vehicle is scrapped at a Registered Vehicles Scrapping Facility.

The Delhi government is gearing up to introduce a tax concession plan for scrapping outdated vehicles, proposing the scheme to Lt Governor VK Saxena for final approval.

According to Transport Minister Kailash Gahlot, the initiative aims to encourage the disposal of old, polluting vehicles and foster the adoption of newer, environmentally friendly options. 'By offering tax concessions, we hope to ease the transition for vehicle owners,' he said.

The concessions entail a 20% Motor Vehicles Tax reduction for new petrol, CNG, or LPG non-transport vehicles, and a 15% reduction for diesel counterparts. For transport vehicles, the reductions are 15% for petrol, CNG, or LPG models and 10% for diesel models. However, total concessions are capped at 50% of the scrap value.

A Certificate of Deposit, valid for three years and electronically tradable, must be presented for the tax reduction. This follows a 2018 Supreme Court decision banning older vehicles and a 2014 National Green Tribunal order restricting the parking of overage vehicles in public places. The Delhi government has already deregistered 5.5 million such vehicles.