Nitin Gadkari Announces Vehicle Scrappage Policy With 25% Waiver on Road Tax

by Jatin Chhibber | 20/03/2021
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The Ministry of Road Transport and Highways has recently proposed a new vehicle scrappage policy at Lok Sabha, which will come into effect from next month.

Recently, the Minister of Road Transport and Highways, Mr Nitin Gadkari has announced a new vehicle scrappage policy in Lok Sabha. He revealed the details of the voluntary scrappage scheme for the vehicles in India, which are older than 15 years. The main aim of the government is to reduce pollution and also to boost the Indian automobile market. This new vehicle policy will come into effect from 1st June 2021. Moreover, the Ministry of Road Transport and Highways has also advised the automobile manufacturers in India to offer a 5 per cent discount on the purchase price of a new vehicle for anyone who scraps his old car or bike first. 


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They have also asked the state government to waive the registration fees on the purchase of new vehicle of such buyers. These exact policy and laws are yet to be drafted. Moreover, the state government can also be advised to offer up a 25 per cent rebate for a personal vehicle and a 15 per cent discount for commercial vehicles on road taxes. The customers in India who will scrap their vehicles will also get around 4% to 5% of the original ex-showroom cost of the scrappage vehicle. The fitness tests will get compulsory for heavy commercial vehicles from 1st April 2023. 



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Nitin Gadkari has also requested Finance Minister Nirmala Sitharaman to consider a GST cut for such cars, which will further cut down the prices of the cars for the customers who have scrapped their vehicles. Nirmala Sitaram is yet to respond to this request officially. Mr Nitin Gadakri said that the scrapping of cars and bikes will increase the recycling of different parts of the car and will reduce waste. Moreover, he has increased the prices of re-registering any vehicles after 15 years. These vehicles have to go for via a mandatory automated fitness test. The vehicle, which will fail this test will get unregistered automatically. 

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