Scrap old vehicle, get up to 50% motor vehicle tax concession on new vehicle in Gujarat

Gandhinagar: The Gujarat government has announced a concession of up to 50% on motor vehicle tax for owners who scrap eligible old vehicles and purchase new ones. The concession will be available at the time of registering a new vehicle against a valid Certificate of Deposit (COD) issued after the old vehicle is officially scrapped.

The provision covers transport and non-transport vehicles manufactured under Bharat Stage-I (BS-I) and earlier emission standards. It also includes medium and heavy goods vehicles and medium and heavy passenger vehicles manufactured under BS-II standards, according to a notification issued by the state Ports and Transport Department.

Under the provision, vehicle owners can submit the COD obtained after scrapping an eligible vehicle while registering a new vehicle and claim the applicable motor vehicle tax concession. The concession will be calculated according to the existing rules and procedure.

The move is aimed at encouraging the scrapping of older, high-emission vehicles while providing a financial incentive to owners purchasing new vehicles.

COD required to claim concession

The Certificate of Deposit issued after the official scrapping of an eligible vehicle will be required to claim the tax concession on a new vehicle. Owners will have to produce the relevant COD at the time of registration to avail the benefit.

The concession could provide a significant financial benefit, particularly to owners of older commercial vehicles, by reducing the motor vehicle tax payable on a replacement vehicle.

COD deadline set for March 31, 2027

Only eligible CODs issued up to March 31, 2027, will be considered for the concession. Vehicle owners will therefore have to complete the scrapping process and obtain the COD within the stipulated period to qualify.

The government has clarified that the existing method of calculating motor vehicle tax will remain unchanged, with the provision providing the applicable concession against a valid COD.

No repeat benefit for the same vehicle

The state government has also clarified that the tax concession cannot be claimed more than once against the same scrapped vehicle. If a concession has already been availed using the COD of a particular vehicle, that vehicle cannot be used again to claim the benefit under this provision. DeshGujarat