Petrol and Diesel Cars to attract Green Cess upto Rs.12K; EV Buyers to get Rs.50K Refund?

In an effort to boost the sales of Electronic and battery-driven vehicles, the National Institution for Transforming India (NITI) is delving upon introducing a new policy which will reward EV buyers, but on the flipside batter petrol and diesel car buyers further.

Petrol & Diesel Car buyers may have to shed another Rs.12000 as Green Cess, if the latest recommendations by the NITI Aayog come into effect. (Getty images)

Petrol & Diesel Car buyers may have to shed another Rs.12000 as Green Cess, if the latest recommendations by the NITI Aayog come into effect. The cess hence collected will be utilized in uplifting the manufacturing and sales of Electronic Vehicles in the country, that is long criticized for rising pollution levels and climate change, besides being marred by humungous oil imports and petrol/diesel prices. In an effort to boost the sales of Electronic and battery-driven vehicles, the National Institution for Transforming India (NITI) is delving upon introducing a new policy which will reward EV buyers, but on the flipside batter petrol and diesel car buyers further. As per reports, NITI Aayog is drafting a policy as per which, incentives ranging from Rs.25000 to Rs.50000 will be directly credited back to electronic vehicle buyers. To encourage the electronic and battery-driven automobile companies, the aayog is proposing to scale down customs duty, exempt registration fee and road tax, besides reducing GST on input raw material, parts and batteries. At present, green cess of 1% is levied on petrol cars and 2.5% on diesel cars. Speaking of the development, Maruti Suzuki Chairman – Mr. RC Bhargava, has voiced his opinion suggesting that only car buyers should not be slapped higher green cess, rather motorcycle owners too should be brought in the ambit as two/third of petrol is consumed by two-wheelers and one/third by four-wheelers. “If the principle idea is to reduce pollution then two-wheelers are also big polluters. Why not a cess on two-wheelers which are (powered by) petrol? I am not saying don’t put cess on cars. I am saying we should put a cess on petrol two-wheelers to subsidise electric two-wheelers. Two-thirds of petrol consumed in India is by two-wheelers. Charging infrastructure becomes far more practical for electric two-wheelers than other segments,” stated Mr. Bhargava. Currently, the four-wheeler electric vehicle sales stand at a meagre 10% whereas 90% sales figures come from electric and battery driven two-wheelers. The Maruti Chairman’s standpoint to fund incentives on two-wheeler electric automobiles from two-wheeler petrol vehicles makes sense. Such a move has a large potential to reduce pollution levels and petrol consumption in large and small cities, simultaneously.