Green Tax on Cars – Meaning, Rules & Charges Explained

The Green Tax in India is a type of environmental tax charged on vehicles, especially older ones that run on petrol or diesel. It aims to reduce pollution by discouraging the use of high-emission vehicles.

Let’s understand this with an example. Rakesh owns a 15-year-old diesel car. When he went to renew his vehicle registration, the transport office asked him to pay a Green Tax of ₹5,000. This amount is charged because his car emits more pollutants compared to newer models.
 

The Green Tax encourages vehicle owners like Rakesh to switch to cleaner alternatives such as electric or CNG vehicles. It also supports India’s efforts to improve air quality and reduce environmental damage.

How Much Do You Pay as a Green Tax for Old Vehicles in India?

Green tax rates for old vehicles in India are not the same across all states, as vehicular taxation is a state matter. Each state sets its rate, just like it does for road tax. So, it’s best to check with your local Regional Transport Office (RTO) for the exact amount.

According to general guidelines:

• Commercial vehicles over 8 years old must pay green tax when they renew their fitness certificate.
   
• Private vehicles older than 15 years must pay it while renewing their registration.

For commercial vehicles, the green tax is usually 10% to 15% of the road tax, depending on the engine type and seating capacity. For private cars, it can go as high as 50% of the road tax amount.

States with higher pollution levels may charge more under their RTO zone to encourage cleaner transport. This system ensures that older, more polluting vehicles contribute more to environmental protection.

How to Check the Green Tax for Your Vehicle?

To check the green tax for your vehicle, you can visit any RTO in your state. They will give you details about the rules, eligibility, and tax rates that apply to different vehicles. Each state may follow slightly different rules, so it’s best to get information locally.

An easier way is to use the mParivahan app. When you log in and enter your vehicle details, the system automatically calculates the correct green tax based on your registration information.

Just like paying road tax or renewing car insurance, paying green tax is mandatory under the Motor Vehicles Act in India. If you fail to pay, you may face fines or legal action, so it’s important to stay updated and pay it on time.

Does Green Taxation Truly Help India?

Yes, green taxation plays a vital role in India's fight against pollution. The government introduced this environmental tax to reduce harmful vehicle emissions and promote cleaner alternatives. It works with three key goals:

1. Discourage the use of old, polluting vehicles
    
2. Collect funds for environmental protection efforts
    
3. Push for faster adoption of cleaner fuels and technologies

Let’s see how it helps using an example

How Green Tax Influences Vehicle Choices

Neha owns a 16-year-old petrol car in Delhi. When she went to renew her registration, she had to pay ₹6,000 as green tax. Her friend Amit, who drives a 5-year-old CNG car, paid nothing. Seeing the cost, Neha decided to replace her old car with a newer, low-emission model.
 

Why It Matters
 

• Old diesel and petrol vehicles cause major pollution in cities.
   
• Green tax makes owners think twice before keeping them running.
   
• Funds collected go towards clean transport projects and pollution control.
   
• Like car insurance, paying green tax is a legal and essential step.
   
• The mParivahan app makes payment quick and automatic based on your registration.
   

Green taxation not only discourages polluting habits but also pushes India towards a cleaner, greener future. It turns a small payment into a long-term investment in public health and environmental safety.

How Much Green Tax Do You Pay on a Car in India?

The green tax in India is charged based on the age, engine type, and seating capacity of the vehicle. Since tax rates are set by individual states, they can differ across regions. However, there are general guidelines that most states follow.

Here’s a simple table to give you an idea:
 

You can confirm the exact amount by visiting your local RTO. Paying green tax is mandatory, just like your car insurance or road tax. To make it easier, the mParivahan app calculates the amount automatically using your registration details, allowing you to pay quickly and avoid penalties.

Which Vehicles Must Pay Green Tax in India?

In India, the green tax is charged on both commercial and private vehicles that run on petrol or diesel, especially once they reach a certain age. The aim is to reduce pollution caused by older engines and encourage the shift to cleaner fuel options.

However, if you own a CNG or electric vehicle, you don’t need to pay this tax, as these are considered eco-friendly alternatives.

Here’s a quick look at who needs to pay:

Vehicles Covered Under Green Tax
 

Key Benefits of Green Tax on Vehicles

The green tax is not just a penalty on old vehicles's a tool that helps modernise India’s transport system and protect the environment. Below are some of the main benefits explained in simple terms.
 

By levying a green tax, the government pushes for cleaner roads, healthier lives, and a greener future, all while guiding people toward better vehicle choices.

Conclusion

The green tax on cars is an important step taken by the Indian government to reduce pollution and promote cleaner transport. By applying this tax to older petrol and diesel vehicles, the government encourages owners to switch to newer, eco-friendly options like electric or CNG vehicles.

This tax not only helps lower harmful emissions but also supports environmental projects such as emission monitoring. Paying green tax is now a legal requirement, just like road tax or insurance, and helps ensure that every vehicle on the road plays a part in protecting the environment.

FAQ’s

1. What is the Green Tax on cars?
The Green Tax is a charge the government applies to older petrol and diesel vehicles to reduce pollution and promote cleaner transport options.

2. Who needs to pay the Green Tax?
Owners of commercial vehicles over 8 years and private vehicles over 15 years must pay Green Tax during fitness or registration renewal.

3. Are electric cars charged Green Tax?
No, electric and CNG vehicles are exempt from the Green Tax as they produce fewer or no emissions compared to petrol and diesel vehicles.

4. How is the Green Tax calculated?
The tax is usually 10–15% of the road tax for commercial vehicles and can be up to 50% for private cars, depending on the state.

5. Where can I pay the Green Tax?
You can pay Green Tax easily through the mParivahan app or by visiting your local RTO office with the vehicle registration details.
 

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