Maharashtra Doubles Green Tax On Old Vehicles, Offers Up To 30% Tax Relief For Scrapping

State government announces incentives to scrap polluting vehicles while increasing green tax on older cars to reduce pollution.

The Maharashtra government has announced a major policy change aimed at reducing vehicular pollution in the state. Chief Minister Devendra Fadnavis, while presenting the state budget for the financial year 2026–27, announced that owners who scrap their old vehicles will receive significant tax concessions, while green tax on older vehicles will be increased.

The move is intended to encourage people to replace highly polluting vehicles with newer and cleaner models.

Green Tax Increased On Old Vehicles

Under the new decision, the green tax imposed on old vehicles in Maharashtra will be increased significantly. Owners of older and highly polluting vehicles may now have to pay up to 30% higher motor vehicle tax.

The policy mainly targets vehicles that follow BS-4 or older emission norms, as these vehicles are considered to contribute more to pollution.

Officials said the decision was taken as part of the government’s broader effort to control rising air pollution in urban areas.

Major Tax Benefits For Scrapping Old Cars

Along with the tax hike, the state government has also introduced incentives for vehicle owners who decide to scrap their old vehicles and purchase new ones.

Vehicle owners who scrap their BS-4 vehicles and buy a new vehicle will receive around 16% concession in motor vehicle tax.

Those scrapping BS-3 or older vehicles will receive an even larger benefit, with up to 30% tax concession while purchasing a new vehicle.

This initiative is expected to encourage people to replace older vehicles with cleaner and more fuel-efficient models.

Scrapping Timeline For Different Vehicles

The government has also clarified timelines for scrapping various categories of vehicles.

Government vehicles will have to be scrapped once they complete 15 years of service.

Private cars may be scrapped after 20 years, while auto-rickshaws may be scrapped after 15 years. Black-and-yellow taxis will also be eligible for scrapping after 20 years.

Aim To Reduce Pollution

Authorities said the policy is designed to gradually remove older, high-polluting vehicles from the roads rather than imposing an immediate ban.

Several cities in India are already facing increasing air pollution due to vehicle emissions. By increasing taxes on older vehicles and offering incentives for scrapping them, the state government hopes to promote cleaner transport and improve air quality.

The decision may make it more expensive to continue using old vehicles, while encouraging owners to shift to newer and less polluting alternatives.