Maharashtra pulls back 6% tax on high-end electric cars
Maharashtra pulls back 6% tax on high-end electric cars
The Maharashtra government has reversed its decision to impose a 6% tax on electric vehicles (EVs) costing more than ₹30 lakh. This decision was announced by Chief Minister Devendra Fadnavis in the state legislative council on Wednesday.
The tax was originally part of the 2025-26 state budget, presented by Deputy Chief Minister and Finance Minister Ajit Pawar, to raise extra funds for the state. However, the proposal faced strong opposition from car manufacturers and other stakeholders who argued that it would contradict efforts to promote the use of EVs and reduce pollution. Ultimately, the government yielded to these concerns and decided to drop the tax.
During a council debate on electric vehicles (EVs) and air pollution, Anil Parab, a leader of Shiv Sena (UBT), raised concerns about the proposed tax. He stated, “The Maharashtra government’s plan to impose a 6% tax on electric vehicles priced above ₹30 lakh goes against the objective of encouraging cleaner vehicles.”
In response, Fadnavis explained that the tax would not generate significant revenue and could hinder the state’s push for EV adoption. “It could give the impression that we are against the adoption of electric vehicles. Therefore, the state government has decided to cancel the 6% tax on high-priced electric vehicles,” he said.
Despite the scrapping of the EV tax, other budget changes will take effect from April 1, 2025. These include a 1% tax increase on CNG and LPG vehicles, as well as a 7% tax on construction and light goods vehicles.
Maharashtra is emerging as a significant EV hub, with new factories opening in Pune and Chhatrapati Sambhaji Nagar. The state’s commitment to promoting EVs is evident in the fact that over half of its newly registered vehicles are now electric. To further encourage EV adoption, the government is establishing charging stations across Maharashtra and introducing over 2,500 electric buses into the public transport system in phases. Chief Minister Fadnavis emphasized that transitioning to EVs is crucial for tackling air pollution, as petrol and diesel vehicles are major contributors to the problem.
