India’s Ministry of Road Transport and Highways has finalized a draft mandatory commercial vehicle scrapping policy which envisages a three-tier fiscal incentive, a government official said on Friday, November 30.
The official said that any commercial transport operators scrapping a vehicle over 20-years old under the mandatory scrapping policy will be entitled to a discount on the Goods and Service Tax (GST) at the time of purchase of a new vehicle, a fair value for the scrap from designated recyclers and a discount on the new vehicle to be offered by commercial vehicle manufacturers.
It is estimated by the ministry that the combined three-tier fiscal incentives will translate into a cumulative 15 percent reduction in the cost of acquiring a new vehicle, the official added.
The draft policy is expected to be submitted to the Cabinet of Ministers for formal approval within the next two months, the official said. He pointed out that the government has sought early finalization of the draft mandatory vehicle scrapping policy as it is keen on the simultaneous unveiling of the national scrap policy since the two are interlinked to generation of scrap across the country and making higher volumes available to the secondary steel sector.