The Ministry of Road Transport and Highways (MoRTH) has clarified that the recently introduced Green Tax will be levied through a separate notification and billing system, distinct from traditional road tax collection. This announcement comes amid confusion among vehicle owners who were uncertain about whether the green tax had been integrated into the standard road tax structure. The ministry emphasized that the green tax is an independent levy, specifically aimed at discouraging the use of older, more polluting vehicles.

According to the official notification, private vehicles older than 15 years and commercial vehicles older than 8 years will be subject to this additional environmental surcharge at the time of fitness renewal. The green tax will vary based on the fuel type, vehicle age, and emission class, and will be collected electronically during the registration renewal process. The revenue generated from this tax will be directed towards a dedicated Green Fund, meant for tackling air pollution and developing eco-friendly public transport infrastructure.

Officials further stated that state transport departments have been instructed to issue separate challans or e-invoices for green tax collection to avoid confusion and ensure administrative transparency. Vehicle owners will receive distinct notifications regarding their road tax dues and green tax obligations, both of which must be settled before registration or renewal. By separating these two tax components, the government aims to maintain clarity in policy enforcement and track environmental impact contributions more effectively.