Transport Minister Nitin Gadkari mentions tax on diesel vehicles: Why is diesel under pressure?

Subject : Science and technology

Section: Msc

Introduction

On September 12, Road Transport Minister Nitin Gadkari suggested the possibility of imposing an additional 10% GST on diesel-run vehicles as a “pollution tax” if the use of such vehicles continues.
He later clarified that there was no active proposal for this tax at the moment.

Policy Pushback Against Diesel

Gadkari’s statement aligns with the broader policy pushback against diesel.
A committee appointed by the Ministry of Petroleum and Natural Gas had recommended banning diesel four-wheel vehicles in cities with over 1 million population by 2027.

Existing Taxation

The government already imposes a 28% tax on diesel cars, along with additional cess based on engine capacity, resulting in a total tax of nearly 50%.

Why There’s a Pushback Against Diesel

The government aims to reduce greenhouse gas emissions and generate 40% of India’s electricity from renewables as part of its net-zero emissions goal by 2070.
Diesel accounts for around 40% of India’s petroleum product consumption, with 87% of diesel sales going to the transport sector, primarily trucks and buses.
Three states—Uttar Pradesh, Maharashtra, and Haryana—account for almost 40% of diesel sales in India.

Concerns About Diesel-Run Cars

Diesel engines emit higher levels of oxides of nitrogen (NOx) due to their higher compression ratios compared to petrol engines, contributing to a negative perception of diesel.
Car manufacturers decided to exit the diesel segment due to the rollout of stricter BS-VI emission norms in 2020 and the high costs associated with upgrading diesel engines to meet these standards.

Why Some Individuals Still Prefer Diesel over Petrol

Diesel engines offer superior fuel efficiency and greater torque, making them preferable for heavy vehicles and reducing the risk of stalling during haulage.
While historically cheaper, diesel’s price advantage over petrol has diminished since fuel price decontrol in 2014, diminishing its attractiveness to buyers.