Government drops controversial eco-fee on 30-year-old cars after backlash

Uzbekistan has removed a controversial provision from its draft law on end-of-life vehicle recycling that would have required owners of cars aged 30 years and older to pay an annual environmental compensation fee. The decision followed extensive public consultations and a comprehensive revision of the bill.

The image was created by artificial intelligence.

The Agency for Waste Management and Circular Economy Development announced that the proposal requiring owners of vehicles at least 30 years old to pay an annual environmental compensation of 30 Base Calculating Amounts, equivalent to UZS 12.36 million, has been excluded from the draft legislation.

According to the agency, the bill is undergoing substantial revision after receiving public feedback. It said the removal of the proposed annual fee was one of the most significant changes made in response to comments from citizens.

Instead of imposing an administrative obligation, the revised proposal introduces a market-based incentive mechanism. Under the new model, a nationwide network of independent vehicle assessment and recycling companies will be established through open tenders.

Old vehicles, including those that are no longer operational, will be assessed at market value. Specialists will inspect non-running vehicles at their current location.

After the appraisal, owners will be able to choose between receiving a cash payment or a special voucher that can be used as a down payment when purchasing a new vehicle from an official dealer. The value of the voucher will be deducted from the purchase price, while the remaining amount can be paid through an interest-free installment plan over a period of two to seven years.

Owners who do not wish to use the voucher will be able to exchange it for cash within one month. Part of the costs incurred by companies carrying out vehicle assessments and recycling will be reimbursed from the vehicle recycling fee fund in accordance with the approved calculation methodology.

The agency illustrated the proposed mechanism with an example. If an old GAZ-24, Moskvich, or first-generation Nexia is valued at the minimum of UZS 5 million, its owner would be able to purchase a new Chevrolet Cobalt priced at UZS 165 million without making an upfront payment, repaying about UZS 1.9 million per month over seven years with no interest. If the old vehicle is valued at UZS 70 million, the monthly payment would fall to around UZS 1.13 million.

The agency said the reform is needed because, of the approximately five million vehicles registered in Uzbekistan, around 100,000 are no longer roadworthy and account for 63% of harmful emissions in urban areas. It also noted that recycling a single end-of-life vehicle can generate up to 50 kilograms of hazardous solid waste.

The draft law has not yet been finalized. The agency has invited the public to continue submitting comments and proposals as work on the legislation continues.