Levy 25 percent cess on SUV buyers, SC committee

An ECC of 25 pc of the vehicle cost proposed for vehicles above 2000 cc mainly SUVs as they are the largest and more polluting segment.

Published: 05th July 2016 08:47 PM  |   Last Updated: 05th July 2016 08:47 PM   |  A+A-

NEW DELHI: An environment compensation charge (ECC) of 25 percent of the vehicle cost is proposed for vehicles above 2000 cc mainly SUVs as they are the largest and more polluting segment of the market, according to a report by a Supreme Court empowered committee.

In light of the current conundrum regarding diesel vehicles, the Environment Pollution (Prevention and Control) Authority (EPCA) has released a detailed report with recommendations on an appropriate cess on the cost of such vehicles.

“ECC of 10 percent is proposed for vehicles upto 1200 CC would be a sufficient deterrent as it is a very small segment of the market. ECC of 25 percent is proposed for vehicles above 2000 as they are the largest and more polluting segment of the market. For vehicles upto 2000 CC, ECC of 20 percent as calculated would be appropriate,” said the report.

Questioning less tax paid by diesel car owners, the report said that they cannot pay less tax per litre of fuel compared to petrol car and two-wheeler users.

“This needs to be equalized to control growing use of low tax diesel fuel (meant for farmers and freight) in cars that have cleaner substitutes. This is needed to reduce public health risk. Only cleaner fuels like CNG, LPG, electric and hybrid, can have incentive to protect public health,” it further said.

The report also analysed that the estimated health damage from the sale of a single diesel car when compared with a petrol car and is estimated to range from Rs56,301 per vehicle at the low end to Rs1,27,329 at the high end.

In national capital region, report says more than 280,000 individuals are at additional risk of cancer from lifetime exposure to diesel exhaust.

“Over and above the tax differences that should be recovered by ECC, there is higher health costs associated with diesel including strong cancer risk. Based on studies, it is estimated that the combined cancer risk of diesel exhaust in Delhi would be several times that of petrol engines. If the entire population is taken,” it added.

In December 2015, the Supreme Court banned the registration of diesel-run SUVs and high-end cars with engine capacity of 2000CC and above in Delhi and NCR. The ban was initially instituted for a period of three months and was subsequently extended with no deadline.

Auto manufacturers and the Government have argued in the Supreme Court for these vehicles to be allowed again, subject to a payment of one percent of the vehicle’s ex-showroom price as cess.

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