Some of the top luxury car makers have agreed to around INR 25,000 discount and some others are also expected to put a ceiling on the maximum amount, sources told TOI.The auto industry and govt are expected to unveil the measures on Tuesday after deliberating on this for years. Since the scrapping policy was unveiled in March 2021, road transport and highways minister Nitin Gadkari has been pushing for concessions, such as discounts and even lower GST, to encourage car and commercial buyers to scrap their old vehicles.
In 2022, the road transport ministry had sent an advisory to automobile associations to get their members to offer up to 5% discount on the sale price in lieu of scrapped vehicles, but the industry ignored it and opted to negotiate the discount that was commercially viable.
“At present, some vehicle manufacturers are giving discounts for buying new commercial vehicles after scrapping old ones. If more players make such announcements, it will motivate people to phase out old and polluting vehicles,” said a source.
Despite govt’s efforts, voluntary scrapping of vehicles has not gained pace for several reasons. So far, around 1.2 lakh vehicles have been scrapped at registered scrapping centres and nearly 61,000 of these are govt vehicles older than 15 years. There is a target to scrap around 90,000 old govt vehicles by March 2025.
The govt has taken initiatives to set up 60 registered vehicle scrapping facilities and 75 automated testing stations. So far, 21 states and UTs have announced concessions in motor vehicle tax on a vehicle which is purchased against a certificate of deposit of the scrapped one. To incentivise people, 18 states and UTs have announced a waiver in pending liabilities on the vehicles offered for scrapping at the scrapping centres.
Currently, even car dealers do not inform buyers about the policy and individuals have to reach out to the authorised centres and send their vehicles for scrapping.
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