The scrappage policy is back in the works but with several changes. The government is looking at increasing the compliance burden for vehicles which are over 15 years old and is no longer mulling a mandatory scrapping scheme for older vehicles, sources close to the development told CNBC-TV18.
Several rounds of consultation have taken place among various ministries under NITI Aayog's National Mission for Transformative Mobility and the theme of the discussions has been that new vehicle sales won't be promoted at the cost of old but there will be more bumps on the road for older vehicles.
Among the key points being discussed for the new scrappage policy is a steep hike in re-registration fee for older vehicles, which is done at the time of renewal after 15 years. This is likely to vary from Rs 15,000 for personal cars to over Rs 30,000-35,000 for commercial vehicles, the sources in the know said.
"Re-registration fee maybe twice or thrice of the initial registration fee for different categories of vehicles."
The stakeholders are also looking at a more frequent cycle for fitness certificate for the older vehicles under the new scrappage policy. As against a period of one year, the government is considering asking the old vehicles to get a fitness certificate every 6 months, the sources added.
"The impetus is on discouraging older vehicles but not at the cost of new vehicle sales. The discussions have also been on increasing the registration fees for new vehicles from the current level. However, this is proposed to be waived off if you scrap your old vehicle at an authorised scrapping centre," another source aware of the development said.
The government is also working on a strong IT backbone to ensure genuine transactions and prevent duplicate usage of scrapping certificate.
The Ministry of Road Transport and Highways, Ministry of Environment, Forest and Climate Change and Ministry of Steel have been tasked to work towards proper implementation of the policy under NITI Aayog.
In line with the previous roadmap, the road ministry is likely to take up proposals of taxation benefits for scrapping centres under Section 35AD of the Income Tax Act or Section 801A/801B of the Income Tax Act and proposal of rationalisation of input tax credit regime under GST for scrapping centres with the finance ministry.
The environment ministry, on the other hand, is likely to formulate draft regulations on Extended Producer Responsibility for vehicles which are towards the end of their lifecycle. Extended Producer Responsibility is a policy approach under which producers are given a significant responsibility – financial and/or physical – for the treatment or disposal of post-consumer products. The road ministry is likely to determine the parameters for the end of life of a vehicle.
As the policy is part of the Modi government's 100-day agenda, it is likely to be a reality soon, the sources said.
First Published: Jun 21, 2019 1:31 PM IST
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