India should consider taxing passenger vehicles based on emissions rather than length and engine size of vehicles, for a cleaner environment, Nissan Motor India MD Rakesh Srivastava said on Tuesday.
Nissan, which is looking to drive in its global sports utility vehicles, including X-Trail into the Indian market to strengthen its presence in the country, said multiple technologies such as hybrids must also be considered to curb air pollution through automobiles.
“We can have different tax slabs based on the level of emissions,” Srivastava said here in an interaction, adding the government already has a different tax structure for below four meters, above four meters, in terms of length and in terms of fuel. Under the GST regime, cars attract the highest tax slab of 28 per cent and on top of that a cess is levied.
Small petrol cars with engine capacity less than 1200cc attract only 1 per cent cess, while diesel cars with engine capacity of less than 1500cc attract 3 per cent cess, on top of the 28 per cent GST rate.
Similarly, sports utility vehicles (SUVs), which include cars with length exceeding 4,000 mm and having a ground clearance of 169 mm and above attract a GST rate of 50 per cent.
Also, the total tax incidence on hybrid vehicles in the country is 43 per cent, which is inclusive of GST, while battery electric vehicles attract a tax of about 5 per cent. “I think the time has come, maybe, to look towards incentives in the market place based on emission levels, that is going to bring a cleaner and greener environment,” Srivastava noted.