Under the vehicle scrappage policy, you will get a mandatory discount on road tax to the state governments on buying new ones by selling old vehicles in the junk. The road transport ministry said on Tuesday that this discount could range from 1 to 15% on commercial vehicles, while 1 to 25% on passenger vehicles. However, it will be decided by the state governments that how much discount will be given on new vehicles purchased by selling old vehicles in the junk.
Government officials said that changes are being made in the Central Motor Vehicle Act to persuade people to remove old and polluting vehicles. According to Joint Secretary Amit Vardan, "Changes are being made in the rules for discount in road tax. This would not be an advisory. The Center has the power to take decisions on the principle of taxation. So this work is being done within the legal framework.
Union Road Transport Minister Nitin Gadkari has expressed hope of getting cooperation from all the states in implementing the vehicle scrappage policy. He said, "State governments will get more revenue by adopting scrappage policy, as there will be a jump of 25 to 30% in the sale of new vehicles. This will give more tax revenue to both the states and the central government, create more jobs and reduce pollution caused by vehicles.
The government has issued a notification giving complete exemption in the registration fees to those who buy new vehicles by selling old vehicles in the junk. Discount in road tax, zero registration fee and discount of up to 5% in price from the makers of the vehicle will be available only when the scrappage certificate is shown. People will also be able to sell such certificates to others.
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