Just when the auto industry thought that tax related issues on diesel vehicles were done and dusted with. The matter is back in the limelight with the apex court asking the government to explain why an additional green tax must not be levied on diesel cars. CNBC-TV18's Ronojoy Banerjee reports
The apex court on Monday sent a notice to the Central Government asking why a 25% 'green tax' should not be levied on the allegedly gas-guzzling diesel SUVs and cars to discourage sales. The industry now once again has to defend diesel technology which it claims is not only 25% more fuel efficient but also low on carbon dioxide emissions.
Senior Supreme Court advocate and Amicus Curiae Harish Salve has said that Delhi alone adds up to 1,400 new personal vehicles a day -- more than double of what was added in the city in the pre-CNG period.
Salve also says that pollution levels have reached an "unhealthy level" and has therefore argued for an "environment compensation charge" of 25% on new sales.
However, the auto industry is not giving in just yet. Sources say SIAM is seeking a legal opinion on what to do next. The industry's defence is a report published by the Central Pollution Control Board in 2007 that claimed only 7% of the particulate matter that causes pollution is caused by the transport sector.
It also argues that the Delhi government's 25% road tax is already a "green tax." However, the Centre for Science & Environment is taking the industry claims with a handful of salt. It cites a World Health Organisation report which claims diesel vehicles are potentially carcinogenic.
The CSE also says comparisons between diesel technologies in India and Europe are misleading since the fuel used in India emits nearly 30-times more sulphur.
With clearly two different schools of thought on this contentious issue - each throwing new data to defend their case. One wonders how and when will the Great diesel debate end.