Citizens unaware of tax rebate for scrapped vehicles

Hyderabad: Since April 1, vehicle buyers can claim up to 25 per cent rebate on road tax if they have scrapped their old vehicle and have a certificate for proof. Most buyers are not aware of the rule.

The Centre’s vehicle scrappage policy came into effect from April 1. As per the policy, a 25 per cent concession on road tax is available for non-commercial vehicles for 15 years after the purchase, while for commercial vehicles a 15 per cent concession is available for eight years. The certificate to be produced to avail the discount can be issued by a registered vehicle scrapping facility.

Hamza Tambawala, a businessman who recently bought a vehicle after getting his older one scrapped, said he was not aware of the rule. For new four-wheelers in Telangana which cost over Rs10 lakh, the road tax is 14 per cent of vehicle cost while it is 12 per cent for vehicles that cost below Rs 10 lakh. For two-wheelers, the road tax is nine per cent of the vehicle cost. In some cases, owners pay more for second and third vehicles.

Real estate businessman Nabhan Mahmood said he was aware of the rule because his family had a legal background. “We were looking to scrap a couple of cars so we will consider this while buying a new vehicle. But there is a need for greater awareness on this because many are not aware of the rule,” he said.