Union Minister Nitin Gadkari recently reveale the government is considering even more tax concessions on new vehicles bought after scrapping old ones. The revelation made at the inauguration of Maruti and Toyota’s scrapping facility in Noida, Uttar Pradesh.
The National Automobile Scrappage Policy, which was launch in August 2021 by Prime Minister Narendra Modi allows new car buyers to avail upto 25% reduction in road tax, and zero registrations charges.
As per Nitin Gadkari, discussions are on with the GST council to reduce the overall tax for new car buyers who scrap their old cars.
The final decision on this matter will taken by the GST Council and the Finance Ministry.
The government eyes the scrappage policy to be key in the reduction of air pollution.
It will also result in a 10%-12% increase in new car sales, which will boost GST collection by Rs 40,000 crore each, for the state and the central governments.
The reduction in GST is expect to come from this additional collection of taxes.
It is yet not clear exactly when the GST Council and Finance Ministry will give their verdict on this issue, but it should be soon, as the government has been proactively pushing towards less-polluting and safer vehicles on Indian roads, and the scrappage policy is a key step in realising this goal.
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