Recently,
Tesla has launched their electric cars in the Indian market. Though there has
been a mixed reaction by the Indian consumers because of the price of the cars
and lack of charging facilities. It is expected that Tesla will find it
difficult to compete with the Diesel and Petrol variants as well as Indian
electric car manufacturers. Talking about electric cars in order to curb
environmental pollution and encourage people to switch to eco-friendly
transportation mode, the Union Ministry for Road Transport and Highways of
India has approved a proposal to levy a ‘Green Tax’ on old vehicles. Experts
argues that, charging taxes on vehicles that cause environmental pollution will
decrease environmental loss in a cost effective manner by encouraging
behavioural changes among people.
The
Green Tax can be seen as a measure to strengthen India’s commitment to the Paris
Agreement of 2015. As per the agreement India has targeted to reducing the
emissions intensity of its GDP by 33-35% by 2030 over 2005 levels. Let’s first see the salient features of the
proposed tax.
The Green
Tax is expected to come into practice from April 1, 2022. According to the
proposal, personal vehicles will be charged a tax at the time renewal of
Registration Certification after 15 years. The tax may differ based on the type
of vehicle and fuel used in it like petrol/diesel. In order to ensure proper
implementation of the policy, before formal notification, this proposal will
also go to the States for consultation. Green Tax will include levy of 10-25%
of road tax on transport vehicles older than eight years at the time of renewal
of fitness certificate. The proposed green tax also comprises a steeper penalty
of up to 50% of road tax for older vehicles registered in some of the highly
polluted cities in the country. Revenue generated from this tax will be used
for tackling pollution and will be kept in a separate account. A state-of-art
facilities for emission monitoring will also be set up in states. Interested about New Commission for Air Quality management in Delhi NCR? Read here.
Significance of the proposed Green Tax
The
tax will help to reduce air pollution level and ensures the polluter pay for
pollution. The tax will encourage
people to switch to newer and less polluting vehicles such as electric cars and
bike or to use public transportation. It is expected that such a move will also
help in reducing traffic from the roads.
The proposed tax will also discourage people from using older vehicles with
higher emissions which damages environment.
Exemptions
Just
like any other taxes the Government of India has also made certain exceptions
to the law. Vehicles such as strong hybrids, electric vehicles and alternate
fuels (CNG, LPG, ethanol etc.) are exempted under the law. India being an agricultural society having
large number of small and marginal farmers, the Government has also exempted farming
vehicles like tractor, harvester, tiller, etc.
Conclusion
Green
tax is a sign that policy makers is now understanding the seriousness of rising
environment pollution. Though it is just a beginning we need more such efforts
to curb the menace of rising air pollution. India being on the largest greenhouse
gas emitter, a responsible act just like the proposed Green Tax is a welcome
step. Along with this people awareness is also very important to understand the
threat of environmental degradation and display responsible behaviour.
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