Gadkari talks of 10% more tax on diesel vehicles, later clarifies no proposal under consideration

New Delhi: Road Transport and Highways Minister Nitin Gadkari on Tuesday spoke of the need to levy an additional 10 per cent tax on diesel-run vehicles to help cut emissions, but later clarified that there was no proposal under government consideration to impose such a tax.

Speaking at the annual convention of automobile manufacturers body SIAM, Gadkari 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 said, indicating a meeting was scheduled with the Finance Minister for handing over a letter he had drafted on the issue.

But soon after he took to X, formerly known as Twitter, 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 said in a post on X, referring to media reports quoting him as suggesting an additional 10 per cent GST on diesel vehicles.

He emphasised that there was a need to embrace cleaner fuels to cut emissions.

"In line with our commitments to achieve Carbon Net Zero by 2070 and to reduce air pollution levels caused by hazardous fuels like diesel, as well as the rapid growth in automobile sales, it is imperative to actively embrace cleaner and greener alternative fuels. These fuels should be import substitutes, cost-effective, indigenous, and pollution-free," he said on X.

At the Society of Indian Automobile Manufacturers (SIAM) convention, he had warned that the government would increase taxes so much that it would become difficult to sell diesel vehicles.

Most of the commercial vehicles in the country currently run on diesel.

In the passenger vehicle segment, various carmakers including Maruti Suzuki India and Honda have already stopped manufacturing diesel cars.

Gadkari said the contribution of diesel cars has already come down drastically in the country and the manufacturers need to stop selling them in the market.

The minister also highlighted that India is utilising a major portion of fossil fuels in the transport sector which is posing a big economic as well as pollution challenge.

He suggested alternatives such as biofuels, ethanol and green hydrogen in addition to electric vehicles.

At the SIAM annual convention, the minister said the country is making good roads across the country, which is leading to the growth of the automobile industry.

"The auto industry is growing at 15-18 per cent and it is also leading to enhanced usage of fossil fuels. If this goes on like this, you (companies) will be happy, but pollution will make the people of this country sad. So quickly leave petrol, diesel. Please focus on alternatives, this is my request to you," Gadkari said.

He further said, "I will request the finance minister for 10 per cent pollution tax as additional GST on all such engines utilising diesel, from generator sets to vehicle engines."