[TusharK]

The state government of Uttar Pradesh has announced tax exemptions for vehicle scrapping. Vehicles registered before 2003 will get a 75% tax cut, while those registered before 2008 will receive a 50% tax exemption if they are scrapped.



As per the govt. order, diesel vehicles registered in NCR districts between 2008 and 2013, can also avail of the 50% tax exemption. These benefits will be valid for 6 months starting September 11, 2024, to March 10, 2025.

Additionally, the government will also waive penalties for non-payment of dues if the vehicles are scrapped at a registered Vehicle Scrapping Facility Centre. It is said that there are nearly 1.5 lakh end-of-life vehicles, which include 25,000 commercial vehicles that have not cleared their dues.

The move is aimed at reducing air pollution in NCR. The National Green Tribunal (NGT) has already banned diesel vehicles older than 10 years and petrol vehicles older than 15 years from plying in the region.

Source: ET Auto

Link to Team-BHP News

[gokularakkal]

Does that mean the tax exemption can be claimed for AY 25-26 or AY 24-25 and under what provision of the Income Tax Act can this exemption be claimed?

[Turbanator]

Cut on what kind of Tax - I don't think UP is allowing 75% off on GST! It has to be RTO which varies between 8-12% here or is Zero on Hybrids/ Electricals.

75% of 10% of the vehicle costs is less than 8% of the overall vehicle costs!

[Annibaddh]

Originally Posted by Turbanator

Cut on what kind of Tax - I don't think UP is allowing 75% off on GST! It has to be RTO which varies between 8-12% here or is Zero on Hybrids/ Electricals.

75% of 10% of the vehicle costs is less than 8% of the overall vehicle costs!

Isn't that good value for a 20+ year old vehicle? Plus whatever is the scrap value AND past dues. Makes up for the cost of the vehicle quite well - I think this is a lucrative enough plan. The issue is that replacement cost of vehicles has become too high - and leads to significant inertia to change vehicles. More so even for commercial vehicles.

[Turbanator]

Originally Posted by Annibaddh

Isn't that good value for a 20+ year old vehicle? Plus whatever is the scrap value AND past dues.

For NCR residents including parts of UP, we cannot drive any vehicles beyond 10 Years. So, not sure if people are holding their cars. For other places, as you have mentioned, will vary largely upon the value of the Car you are buying. I don't think we will get anything meaningful or at all, rather may have to pay to get the certificate as with anything else

Here's what I got from Chandigarh a few months back, where we have had this policy for a while (25% savings plus some manufacturer rebate- not sure entirely about that)