Vehicle Scrappage Policy:: In a significant move to improve road safety and reduce vehicular pollution, the Telangana government announced its Voluntary Vehicle Fleet Modernisation Policy (VVMP) on Tuesday. The policy, designed to phase out end-of-life vehicles, is in line with recent amendments to the Motor Vehicles Act, 1988.
Key Features of the VVMP
The VVMP targets both transport and non-transport vehicles. Owners of transport vehicles older than eight years and non-transport vehicle owners with vehicles over 15 years are eligible for tax concessions when they purchase new vehicles of the same category. Furthermore, the government has waived outstanding Green Tax and penalties on quarterly taxes for vehicles scrapped within two years of the policy’s notification.
To incentivize scrapping, the policy offers concessions to private vehicle owners who voluntarily scrap their end-of-life vehicles. These owners must provide a Certificate of Deposit and purchase a new vehicle in the same category to benefit.
Additionally, State-owned vehicles over 15 years old must be scrapped through e-auctions.
Infrastructure Development and Digital Solutions
A critical element of the VVMP is the establishment of Registered Vehicle Scrapping Facilities (RVSF) and Automated Testing Stations (ATS). To support the initiative, the Telangana government has sanctioned ₹296 crore to construct 37 ATS facilities across the State, replacing manual testing at Regional Transport Offices (RTOs) where ATS facilities are operational.
The Transport Commissioner of Telangana will act as the Registering Authority, while the Special Chief Secretary will serve as the Appellate Authority for the regulation of these testing stations.
The policy also emphasizes the use of digital solutions like Sarathi and Vahan platforms to streamline vehicle testing and registration processes.
Tax Concessions
The policy provides specific tax concessions for scrapping old vehicles. For instance, a two-wheeler with an ex-showroom price of up to ₹1 lakh will receive a ₹1,000 tax concession, increasing incrementally up to ₹5,000 for more expensive models. Four-wheelers with a price range between ₹5 lakh and ₹20 lakh or more are eligible for tax concessions ranging from ₹10,000 to ₹50,000.
Transport vehicles and construction equipment vehicles are eligible for a 10% tax concession, applied to the quarterly or yearly tax up to eight years for newly registered transport vehicles and LMV tractors.
Alignment with Central Government Policy
The Telangana government’s policy mirrors the Central government’s vehicle scrapping initiative. In the 2023-24 budget, Finance Minister Nirmala Sitharaman highlighted the importance of replacing old vehicles, stating that both the Central and State governments would be supported in their efforts to scrap old vehicles and replace them with more eco-friendly alternatives.
This comprehensive policy is expected to significantly reduce vehicular pollution and enhance the safety and efficiency of the vehicle fleet in Telangana.
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