Govt. might introduce car taxes based on CO2 emissions

The Government of India is considering a new National Auto Policy with a proposal to introduce emissions-based car taxes. The authorities have been in talks with various stakeholders to draft the new policy which could be finalised in the next 3 months. 

As per the draft policy, the GST structure for automobiles, which is currently based on length of the vehicle, engine displacement, engine type and ground clearance will be replaced with a classification criteria based on vehicle length and CO2 emissions. The new tax slabs are expected to be finalized in the coming months.

According to media reports, the government is also looking to strengthen the FAME India scheme for the adoption of electric and hybrid vehicles. Recommendations for a long-term road map for incentives and infrastructure investments for e-mobility have also been included in the draft policy. It has been suggested to have a comprehensive emissions policy for the long term with definite timelines.

Source: Economic Times