The Union Ministry for Road Transport and Highways has recently approved a proposal to levy a “green tax” on old vehicles in a bid to curtail pollution and push consumers to switch to environmental-friendly alternatives. The Indian Auto LPG Coalition (IAC) has welcomed this initiative but says it should be accompanied by incentives to people shifting to cleaner fuels such as Autogas.

“India’s choking cities need to shift a large number of their private vehicles to clean alternative fuels immediately and pushing consumers to switch their existing vehicles to clean alternatives is the quickest way to achieve this. This is why a penalty for polluters must also be accompanied by reward or incentives for citizens switching to clean fuels to make it more impactful,” said Suyash Gupta, Director General, Indian Auto LPG Coalition.

Petrol and diesel vehicles including cars, two-wheelers and three-wheelers can easily be converted to LPG. However, conversion kits are taxed at a GST rate of 28%, a policy that is dichotomous to the government’s commitment to clean energy. “Rationalising this prohibitive GST rate on conversion kits to 5% has been a long-pending plea of our sector. Reducing this GST rate will make conversion kits more affordable for mass usage,” Gupta added.

He also commented that the government should consider subsidising conversion kits for consumers as a move towards incentivising personal vehicle users to shift to clean fuels at a mass level. For more information, please visit this link.

26 May 2021