Government has no plans to impose taxes on diesel vehicles, says Gadkari

Earlier this week, the road, transport and highway minister's remarks regarding the need to levy 10 per cent tax on diesel-run vehicles to help cut emissions had generated lots of controversy.

New Delhi: Seeking to clarify his remarks on taxation of diesel vehicles, Union minister Nitin Gadkari on Thursday said that he wanted to convey to automobile manufacturers to take steps to reduce pollution, and also added that there is no proposal to levy tax on such vehicles.

Earlier this week, the road, transport and highway minister’s remarks regarding the need to levy 10 per cent tax on diesel-run vehicles to help cut emissions had generated lots of controversy.

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“I am not against diesel fuel and neither we are going to levy any tax on diesel vehicles,” Gadkari told CNBC-TV18.

The road transport and highways minister noted that from the pollution point of view, diesel is very hazardous and it is really causing health problem in the country.

Gadkari emphasised that he is not against any industry and pointed out that the government is already giving incentives for electric cars.

“So my suggestion to the industry is that best way to (reduce pollution) is to concentrate on alternative fuel,” he added.

On September 12, speaking at the annual convention of automobile manufacturers body SIAM, Gadkari had said rising pollution level is a serious health concern and there is a case for increasing taxes to dissuade sale of diesel vehicles.

“I am requesting the Finance Minister to impose an additional 10 per cent GST on diesel engines/vehicles. This is the only way to phase out diesel vehicles,” he had said But soon after he took to social media platform X to clarify the government’s position.

“It is essential to clarify that there is no such proposal currently under active consideration by the government,” he had said in a post on X, referring to media reports quoting him as suggesting an additional 10 per cent GST on diesel vehicles.

Automobiles are currently taxed at 28 per cent GST, with additional cess ranging from 1 per cent to 22 per cent depending on the type of vehicle.

SUVs attract the highest GST at the rate of 28 per cent along with a compensation cess at 22 per cent.