Nitin Gadkari looks at tax sops for those scrapping old CVs

Minister for road, transport and highways Nitin Gadkari said he has consulted with the minister for steel, Jyotiraditya Scindia, regarding putting forth a proposal to the finance ministry to consider some concession in GST rates for those purchasing new commercial vehicles, after scrapping old ones.

“The pollution from one old truck is equal to the pollution of 15 new trucks, so it is imperative we scrap them. I request vehicle makers to offer a discount to a buyer who has a scrappage certificate. Alternatively, I am discussing with the steel ministry to request the finance ministry to offer a GST tax benefit on scrapping of vehicles,” said Gadkari at the 62nd Annual Convention of the Society of Indian Automobile Manufacturers (SIAM).

Gadkari said overall, more than 10 million vehicles are scrappage worthy. “There is a potential of using the copper, aluminium, steel and rubber scrap, recycling them and using it for self consumption, which can save cost by 30%,” he said. The minister said he wants to discourage sales of petrol and diesel cars.

“A fuel import bill of ₹16 lakh crore is a big challenge. I request your support in finding solutions of coming out with more cleaner alternative solutions,” he said.

The minister expressed satisfaction on the fast growth for EVs in the Indian market and he informed how all segments have started showing significant growth. Vehicle makers should focus on boosting supplies and cater to the high demand.

“I encourage you to shift towards ethanol and flex fuels. The excess production of sugarcane can be turned into ethanol and used by the industry, which will also bring down the imports,” he said.

The focus on alternate green technologies, coupled with the ministry’s efforts to reduce logistics costs, will also enable auto and parts manufacturers to scale up exports from India.

“I am confident of the automotive industry’s capabilities. We should be able to touch ₹15 lakh crore in turnover in the next five years. The industry should look at ways of reducing imports and building exports. I request SIAM to conduct workshops to find innovative ways of reducing imports. I feel the focus should move from cost to quality, as that will be critical for future growth,” said Gadkari.