Thaindian News

New Delhi, March 23 (IANS) The Centre for Science and Environment (CSE) Wednesday hailed the Delhi governments’ decision to increase tax on diesel vehicles by 25 percent saying that it will help reduce emission levels in the capital.

The organisation also praised the government waiving the value added tax (VAT) on bicycles to protect and encourage these zero-emission modes of transport.

“These two momentous decisions together strengthen the foundations of green budgeting in the capital city, establish the “polluter pays” principle and makes a strong statement against the misuse of diesel subsidy by the rich car and SUV owners,” said CSE’s senior research official and head of its air pollution control team Anumita Roychowdhury.

The government proposal was announced Tuesday by Delhi Chief Minister Sheila Dikshit while presenting the state’s annual budget for 2011-2012.

“Delhi will have to be extra vigilant this time to ensure that the diesel car industry does not scuttle this move as it had done in 2004 when an environment cess on diesel car was proposed by the Dikshit government,” Roychowdhury said.

The Delhi government’s proposal has come at a time when diesel cars make 36 percent of the total sales of new cars in India. They are expected to touch the 50 percent mark soon.

Since 2008, the price gap between petrol and diesel fuels has increased from 28 percent to 35 percent in Delhi.

CSE researchers have been pointing out that the cheaper diesel fuel has become a very powerful incentive for car buyers.

The proposed tax hike on diesel cars, therefore, is an important step forward towards taking away the existing incentive for diesel cars, given the public health and energy security implications, the official said.