Vehicle Scrappage Policy to phase out old and unfit vehicles

Vehicle Scrappage Policy to phase out old and unfit vehicles

Union finance minister Nirmala Sitharaman in the Union Budget for financial year 2021-22 announced that the long-pending voluntary vehicle scrapping policy for phasing out of old vehicles that had been in the works since 2016. Scrappage policy will encourage fuel-efficient, environment-friendly vehicles on the road. Thereby it will reduce vehicular pollution and the oil import bill.

Key Features of the Vehicle Scrappage Policy

1. Under the policy, vehicles would undergo fitness tests after a certain period of time. In the case of personal vehicles the duration is 20 years. In the case of commercial vehicles, this duration is 15 years.
2. Each fitness test will cost approximately Rs 40,000. Other than that, old vehicles will have to pay green tax and road tax.
3. If a vehicle fails a fitness test, it will not get a renewal certificate and won’t be able to run on the road.
4. However, if it passes a fitness test, the vehicle will have to undergo a fitness test, after every 5 years.
5. The aim of all these costs is to discourage consumers from keeping the older vehicle.