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Key Points

The MP Cabinet has approved a significant tax incentive for vehicle owners. Those scrapping old BS-I and BS-II emission standard vehicles will get 50% rebate on new vehicle tax. The rebate requires the new vehicle to be registered in the same owner's name and within Madhya Pradesh. This initiative aims to encourage phasing out of polluting vehicles while boosting new vehicle purchases.

Key Points: MP Cabinet Approves 50% Tax Rebate for Scrapping Old BS-I BS-II Vehicles

  • Rebate applies only to same owner who holds scrapping certificate
  • Certificate valid for three years from date of issue
  • New vehicle must be registered within Madhya Pradesh
  • Rebate available for both transport and non-transport vehicle categories
3 min read

MP Cabinet approves 50% tax rebate on new vehicles purchase for owners scrapping BS-I, BS-II models

Madhya Pradesh offers 50% motor vehicle tax rebate when purchasing new vehicles against scrapping certificates for old BS-I/BS-II models. Valid for 3 years.

"The motor vehicle tax rebate will be granted only when the new vehicle is purchased in the name of the same person - Official Release"

Bhopal, September 9

The Madhya Pradesh Cabinet chaired by Chief Minister Mohan Yadav on Tuesday approved a proposal to grant 50 per cent rebate in motor vehicle tax on new vehicle purchase against a "Certificate of Deposit" issued for scrapping BS-I and earlier emission standard vehicles, as well as medium/heavy goods and passenger vehicles manufactured under BS-II norms.

According to an official release, at present, there are about 99,000 BS-I and BS-II category vehicles on the road in the state. According to the approval, the motor vehicle tax rebate will be granted only when the new vehicle is purchased in the name of the same person, in whose name the Certificate of Deposit is held at the time. The Certificate of Deposit will serve as the essential and sufficient document to claim incentives and benefits on the purchase of a new vehicle. The validity of this certificate will be three years from the date of issue.

The rebate in motor vehicle tax will only be available if the new vehicle is registered in Madhya Pradesh against a Certificate of Deposit issued by an Registered Vehicle Scrapping Facility (RVSF) located within the state. If the certificate has been issued by an RVSF situated outside Madhya Pradesh, the tax rebate will not be applicable. The rebate will be provided only when the new vehicle belongs to the same category as the scrapped vehicle.

For vehicles with lifetime tax already deposited, a one-time 50% rebate in motor vehicle tax will be granted for both transport and non-transport categories. For vehicles on which tax is collected on a monthly/quarterly/annual basis, a 50% rebate will be given for up to eight years.

The concessions notified under the Transport Department's notification dated September 8, 2022 will not apply to vehicles availing tax rebate under this notification.

Additionally, the Cabinet approved the introduction of the Madhya Pradesh Municipality (Amendment) Ordinance 2025, to ensure that the elections for the post of President in Municipal Councils and Nagar Parishads in the state are conducted through direct voting by the electorate in the upcoming elections.

In Madhya Pradesh, the post of President in urban local bodies had been filled through direct elections by voters continuously from 1999 to 2014. Due to the COVID-19 pandemic, elections could not be held in the year 2019. Subsequently, in the 2022 urban local body elections, the post of President was filled indirectly. In the 2027 urban local body elections, however, the President will once again be elected directly by the voters.

In view of this sequence of events, approval has been granted to bring the Madhya Pradesh Municipality (Amendment) Ordinance 2025 to amend the relevant provisions of the Madhya Pradesh Municipalities Act, 1961.

- ANI

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Reader Comments

P
Priya S
Good move for environment, but what about middle-class families who can't afford new vehicles even with 50% tax rebate? The government should also introduce some subsidy scheme for actual vehicle purchase cost.
A
Arjun K
Finally some concrete action on pollution control! MP government is setting a good example for other states. Hope this inspires more people to scrap their old polluting vehicles. 🌱
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Sarah B
The three-year validity period for the certificate is practical. Gives people enough time to plan their vehicle purchase without rushing. Smart thinking by the administration!
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Vikram M
Only for MP-registered RVSF certificates? This might create problems for people who moved to MP recently with their old vehicles. The government should consider a more flexible approach.
Karthik V
Excellent policy! This addresses both environmental concerns and gives economic incentive to vehicle owners. Hope other states follow MP's lead in promoting cleaner transportation.

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