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The new fund will provide financial support to convert taxi, van and HGV engines or exhausts in order to help commercial vehicles comply with new emissions standards to protect public health.
Depending on uptake, funding is anticipated to increase every year until 2021/22.
Cabinet Secretary for Transport, Infrastructure and Connectivity Michael Matheson said: "For taxi drivers, or micro-businesses which rely on their own vans to operate in Scotland's cities, we are offering financial support which will enable them to comply with new standards on emissions to improve air quality.
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"The Retrofitting Fund will open later this month and I would encourage interested businesses and black cab taxi drivers to register on the Low Emission Zone website for further information.
"Scotland's four biggest cities are making good progress in establishing Low Emission Zones by the end of 2020 in order to protect public health. It's important that people start thinking now about the proposed emission standards and exploring the funding which will be made available."
Councillor Anna Richardson, City Convener for Sustainability and Carbon Reduction said: "We are determined to clean up Glasgow's air and ensure our city centre is a healthier and more pleasant place to be.
"Our Low Emission Zone, which was the first to be introduced in Scotland, complements many of our projects and initiatives that aim to improve air quality, including those which encourage a shift toward active and sustainable travel.
"We have adopted a phased approach to implementation and by the end of 2022, the emission standards required to enter Glasgow's LEZ will apply to all vehicles. As a council we are working hard to smooth this transition and today's announcement of a fund to support taxi drivers, micro-businesses and HGVs is really fantastic news."
(MH/CM)
