Clipped from: https://economictimes.indiatimes.com/industry/auto/auto-news/govt-plans-to-provide-more-tax-concessions-on-vehicles-bought-after-scrapping-old-ones-nitin-gadkari/articleshow/87868111.cmsSynopsis
The road transport and highways minister said he is also requesting the GST Council to explore what more incentives can be provided under the National Automobile Scrappage Policy.
The government is looking at extending more concessions to consumers on vehicles purchased after scrapping old, polluting ones, Minister for Road Transport & Highways (MoRTH) Nitin Gadkari said Tuesday.
Gadkari said with the vehicle scrappage policy expected to boost sales of automobiles by 10-12%, earnings of both the central as well as state governments will rise post the implementation of the scheme.
“The GST revenue of both the Centre and states will rise due to the scrappage policy. I will discuss with the finance ministry on how to provide more (tax-related) concessions under the new vehicle scrappage policy,” said he.
The final decision on providing more incentives under the National Automobile Scrappage Policy will be taken by the Ministry of Finance and the GST Council.
Gadkari additionally requested automakers to consider extending discounts to the tune of Rs 1-1.5 lakh to customers scrapping old, polluting vehicles.
Earlier in August 2021, Prime Minister Narendra Modi launched the National Automobile Scrappage Policy to phase out unfit and polluting vehicles. Under this policy, consumers who scrap old vehicles will receive a certificate. Those having this certificate will not be charged any registration fee on the purchase of a new vehicle.
Gadkari said the vehicle scrappage policy is important not only to reduce vehicular pollution but also to strengthen the economy. The policy will ease the process of scrapping old cars, generate fresh investments and create employment. He said he would want to introduce at least 3-4 vehicle recycling or scrapping centres in every district in the country.
Overall, Gadkari said the vehicle scrappage policy can generate investments to the tune of Rs 10,000 crore and employment for 200,000 people, directly and indirectly.
“The auto sector has an annual turnover of Rs. 7.5 lakh crore. Target is to take it to Rs. 15 lakh crore in 5 years. India aims to have net-zero emissions by 2070 & it’s very important for us. I’m confident that scrappage policy is one of the solutions,” said Gadkari.
Gadkari was speaking at the inauguration of the country’s first government approved end-of-life vehicle scrapping and recycling centre – Maruti Suzuki Toyotsu India (MSTI) – in Noida. The scrapping unit, built at an investment of Rs 44 crore, has the capacity to scrap 24,000 vehicles per annum.
MSTI plans to set up more vehicle scrapping centres across the country, based on demand. MSTI is a 50:50 joint venture between Maruti Suzuki and Toyota Tsusho Group.
Maruti Suzuki Managing Director Kenichi Ayukawa said while the National Automobile Scrappage Policy is a ‘commendable step to achieve the national objectives of clean air and safe roads’, it is also important to regularly check the road worthiness and environment friendliness of vehicles to ensure the car is safe for use.
“Like in all other major automobile markets, we need a detailed policy that requires vehicles to be inspected and certified to be road worthy every 3 or 4 years on a scientific based frequency”, said Ayukawa.