New Vehicles with ‘Certificate of Deposit’ to Get 50% Motor Tax Rebate

Bhopal, Sept 2025 : The Cabinet meeting chaired by Chief Minister Dr. Mohan Yadav held at Mantralaya on Tuesday decided to promote scrapping under the Registered Vehicle Scrapping Facility (RVSF). It approved a 50% rebate in motor vehicle tax on new non-transport and new transport vehicles registered against a Certificate of Deposit issued for scrapping BS-I and earlier emission standard vehicles, as well as medium/heavy goods and passenger vehicles manufactured under BS-II norms, subject to conditions.

During 2024–25, the state granted tax rebates of nearly ₹17.05 crore on 1,563 new vehicle registrations. At present, there are about 99,000 BS-I and BS-II category vehicles on the road. Providing a 50% rebate in motor vehicle tax to these vehicles will result in a financial impact of ₹100 crore.

It is noteworthy that the Ministry of Road Transport and Highways, Government of India, will provide special assistance of ₹200 crore to Madhya Pradesh to promote scrapping through the Registered Vehicle Scrapping Facility (RVSF). For controlling air pollution in India, the Bharat Stage (BS-I) emission norms were first introduced in April 2000.

As per the approval, the motor vehicle tax rebate will be granted only when the new vehicle is purchased in the name of the same person, in whose name the Certificate of Deposit is held at the time. The Certificate of Deposit will serve as the essential and sufficient document to claim incentives and benefits on the purchase of a new vehicle. The validity of this certificate will be three years from the date of issue.

The Certificate of Deposit will be electronically tradable. Transfer of the certificate to each new owner will be done on the trading platform as per Form 2D. Once the certificate is used, it will be marked as “cancelled” in the vehicle database by the respective Regional Transport Office or dealer that has granted the benefit to the certificate holder.

The rebate in motor vehicle tax will only be available if the new vehicle is registered in Madhya Pradesh against a Certificate of Deposit issued by an RVSF located within the state. If the certificate has been issued by an RVSF situated outside Madhya Pradesh, the tax rebate will not be applicable.

The rebate will be provided only when the new vehicle belongs to the same category as the scrapped vehicle. For vehicles with lifetime tax already deposited, a one-time 50% rebate in motor vehicle tax will be granted for both transport and non-transport categories. For vehicles on which tax is collected on a monthly/quarterly/annual basis, a 50% rebate will be given for up to eight years.

The concessions notified under the Transport Department’s notification dated 8 September 2022 will not apply to vehicles availing tax rebate under this notification.

Approval of Madhya Pradesh Municipality (Amendment) Ordinance 2025

The Cabinet has approved the introduction of the Madhya Pradesh Municipality (Amendment) Ordinance 2025, to ensure that the elections for the post of President in Municipal Councils and Nagar Parishads in the state are conducted through direct voting by the electorate in the upcoming general elections.

In Madhya Pradesh, the post of President in urban local bodies had been filled through direct elections by voters continuously from 1999 to 2014. Due to the COVID-19 pandemic, elections could not be held in Year 2019. Subsequently, in the 2022 urban local body elections, the post of President was filled indirectly system. In the Year 2027 urban local body elections, however, the President will once again be elected directly by the voters.

In view of this sequence of events, approval has been granted to bring the Madhya Pradesh Municipality (Amendment) Ordinance 2025 to amend the relevant provisions of the Madhya Pradesh Municipalities Act, 1961.