Vehicle Scrappage Policies in India 2025: State-Wise Incentives and How to Avail Them

The vehicle scrappage initiative transforms from a national vision into state-specific programs. Launched nationally in 2021 to phase out polluting old vehicles, the policy encourages owners to scrap end-of-life rides in exchange for financial perks, boosting on-road safety and environmental health. In 2025, amid tightening emission norms and rising fuel costs, scrappage incentives vary by state, often including road tax rebates, scrap value payouts, and waivers on penalties.

If you're searching for "vehicle scrappage policy India 2025" or "old car scrap benefits by state," this guide breaks it down simply, drawing from recent government updates and industry insights. We'll explore key policies, incentives, eligibility, and tips to make the process hassle-free, helping you decide if scrapping your 15-year-old sedan or truck makes sense.

Understanding India's National Vehicle Scrappage Framework

Before diving into states, let's clarify the basics. The Central Vehicle Scrappage Policy mandates fitness tests for vehicles over 15 years (private) or 8-10 years (commercial). Failures lead to mandatory scrapping at Registered Vehicle Scrapping Facilities (RVSFs).

Owners receive a Certificate of Deposit (CoD), unlocking incentives like 4-6% of the ex-showroom price as scrap value from the OEM or dealer. Nationally, new vehicle purchases against this certificate qualify for up to a 25% road tax rebate on personal cars and 15% on commercial ones.

This ties into broader goals like reducing emissions and stimulating auto sales, with over 500,000 vehicles targeted for scrapping annually by 2026. However, implementation lags, with states customizing perks to fit local needs—some aggressive, like Haryana, others emerging, like Telangana.

State-Wise Vehicle Scrappage Incentives in 2025

As of October 2025, at least 21 states and UTs have rolled out incentives, as per recent transport ministry data. These focus on tax concessions for new buyers post-scrappage, waivers on dues, and sometimes fixed rebates. Eligibility typically requires vehicles over 15 years (private) or 8-10 years (commercial), scrapped at authorized centers, with the CoD submitted during new registration.

Here's an easy-to-scan table of key states with their "scrappage incentives by state, India, 2025"—note that general national rebates apply where states don't specify extras. The following table illustrates the same information.

How to Avail Scrappage Incentives: Step-by-Step Guide

Navigating the process is simpler than it seems, especially with digital portals in 2025. Start by checking your vehicle's age via Parivahan.gov.in. If eligible:

• Fitness Test: Visit an ATS (over 1,000 nationwide) for a mandatory check—costs Rs 200-1,000.
• Scrap at RVSF: Take unfit vehicles to authorized centers (find via MoRTH app); get CoD and scrap value (4-6% ex-showroom).
• Buy New & Claim: Purchase a replacement from the dealer; submit CoD at RTO for a tax rebate during registration.
• Track Online: Use state transport sites or apps for status; rebates are credited or deducted instantly.​

Timelines: Most states offer incentives indefinitely, but waivers (e.g., Telangana) have 2-year windows. National policy runs till 2030, with states aligning.

Pros and Cons of Scrappage in 2025

Pros: Saves on taxes, promotes safer roads, reduces pollution (scrapped vehicles cut emissions by 20-30%), and boosts resale via CoD.

Cons: Limited RVSFs (only 100+ operational), high initial scrap costs for some, and no incentives for EVs yet in many states.

Final Thoughts: Is Scrappage Worth It for You?

In 2025, with fuel at Rs 100/liter and stricter norms, scrappage offers real savings—potentially Rs 50,000-2 lakh per vehicle. If your old clunker fails fitness, it's a no-brainer; otherwise, weigh repair costs vs. rebates. For "best scrappage deals India 2025," check northern states like Uttarakhand. Consult your local RTO or dealer—going green never hurts the wallet this much. Stay tuned for policy tweaks; India's auto future is cleaner by the mile.

CarBike360 Says

The 2025 vehicle scrappage policy offers a prime opportunity to replace aging, polluting vehicles with safer, eco-friendly models while enjoying financial perks. By understanding state-specific incentives and following an organized process, owners can maximize benefits and contribute to cleaner roads. Whether for savings or sustainability, scrapping an old vehicle today can be a smart, future-ready choice.