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Green Tax: Know what is the Green Tax, which the Modi government is preparing to put on your old vehicle!

The common man is expecting tax exemption in the budget, but before the relief, the central government has decided to levy green tax on every type of vehicle. Actually, Union Transport and Road Minister Nitin Gadkari has approved the imposition of green tax on vehicles older than 8 years.

By the way, green tax is already charged in many states. But now the central government has decided to impose a green tax on vehicles older than 8 years. Before the rules are notified, this proposal will be sent to the states and union territories on behalf of the central government. States will be consulted in this matter before notifying the proposal.

What is ‘Green Tax’?
The government’s argument is that pollution from older vehicles is more, so some of the cost that will be incurred on reducing pollution, should be recovered from old vehicles. This tax is named ‘Green Tax’. That is, tax will be charged to reduce pollution. The revenue from green tax will be used for environmental protection.

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Giving information about the imposition of green tax, the Transport Ministry said that the revenue from this tax will be used to control pollution. According to the proposal, green tax will be levied on 10 to 25 percent of the road tax on the transported vehicles.

In highly polluted cities, registered vehicles will attract the highest green tax (50% of road tax). There will be a separate green tax slab for diesel and petrol engine vehicles. However, green tax will not be levied on CNG, LPG, ethanol, electric vehicles. Farming-related vehicles such as tractors, harvesters, tillers are also excluded from the green tax.

How will green tax be collected?
This tax will be collected during the renewal of the fitness certificate. That is, vehicles that are 8 years old will be charged during their fitness test by adding green tax. According to government estimates, commercial vehicles account for 65-70 percent of the pollution caused by vehicles. The total number of commercial vehicles is about 5 percent of the total vehicles.

On the other hand, green tax will be imposed on private vehicles while renewing the registration certificate after 15 years. Public transport vehicles such as city buses will attract less green tax. The revenue collected from the green tax will be kept in a separate account. If you talk about the benefits, people will adopt new and less pollution vehicles due to green tax.

Parvesh Maurya
Parvesh Maurya
Parvesh Maurya, has 5 years of experience in writing Finance Content, Entertainment news, Cricket and more. He has done BA in English. He loves to Play Sports and read books in free time. In case of any complain or feedback, please contact me @
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