What is the news?
The Finance Minister has announced the voluntary vehicle scrappage policy. It aims at phasing out old and unfit vehicles.
About vehicle scrappage policy
- Aim of the Policy: Scrappage policy will encourage fuel-efficient, environment-friendly vehicles on the road. Thereby It will reduce vehicular pollution and the oil import bill.
- Key Features :
- Under the policy, vehicles would undergo fitness tests after a certain period of time. In the case of personal vehicles, the duration is 20 years. In the case of commercial vehicles, this duration is 15 years.
- Each fitness test will cost approximately Rs 40,000. Other than that, old vehicles will have to pay green tax and road tax.
- If a vehicle fails a fitness test, it will not get a renewal certificate and won’t be able to run on the road.
- However, if it passes a fitness test, the vehicle will have to undergo a fitness test, after every 5 years.
- The aim of all these costs is to discourage consumers from keeping the older vehicle.
- The incentives for vehicle scrappage not announced yet. It is expected that the Government may announce some incentives and monetary benefits for the consumers scrapping their old vehicles.
Source: The Hindu