New Delhi: A high-powered committee has given an in-principle clearance to a recommendation to scrap commercial vehicles older than 20 years from April 1, 2020.

The proposal will require the clearance of the Union cabinet before it is implemented. The recommendation will have no impact on private vehicles as long they clear the routine fitness tests.

The decision to cap the life-term of commercial vehicles was given the tentative approval at a meeting in the Prime Minister's Office (PMO), which was attended by officials from Niti Aayog and the ministries of transport, heavy industries, finance and environment.

Commercial vehicles like taxis, trucks and buses that were registered before the year 2000 will not be allowed to ply on the roads from 2020.

The development follows road, transport and highways minister Nitin Gadkari's announcement that the "Vehicles Scrapping Policy", aimed at curbing pollution, has almost been finalised.

The government expects at least 7 lakh commercial vehicles registered before 2000 to be out of the road in 2020. Since a mechanism will be in place capping the age starting from 2020, older commercial vehicles will be automatically deregistered. The government will give some tax relief to those who scrap their old vehicles and buy a new one.

A proposal to keep the sale of old vehicles as scrap out of the GST regime is also being considered. Subsequently, when the owner of the scrapped vehicle opts for a new one, he may get a discount. The proposals will be placed before the GST Council.

Sources said the GST Council would be requested to reduce the rate to 18 per cent from 28 per cent for a new commercial vehicle that would be purchased in place of a scrapped vehicle. The GST Council will decide the amount of concession that the Centre and the states will offer.

"The overall benefit of buying a new vehicle in place of scrapped vehicle would be about 15-20 per cent of the new vehicle cost," a source said.

The steel ministry will come out with recommendations for the scrapping centres while the environment and forest ministry will draft rules and regulations, the official said.

The ministry of road transport and highways may issue a notification within three months and the states will be consulted, he added.

The ministry is keen on implementing the Voluntary Vehicle Fleet Modernisation Programme (V-VMP) policy that aims at scrapping 20-year-old commercial vehicles in the first phase.

Earlier, the ministry had sent a concept note on the V-VMP to the committee of secretaries on creating an ecosystem for voluntary scrapping and replacing old polluting vehicles. The V-VMP policy proposes to take 28 million old vehicles off the road.