The Maharashtra govt has decided to drop the earlier imposed 6% tax on premium EVs above Rs. 30 lakhs, This decision came after determining that taxes on the luxury EVs would not generate significant revenue.
Maharashtra’s Chief Minister Devendra Fadnavis, on Wednesday, stated in the state legislative council that the government has planned to drop a 6% tax on premium EVs above Rs. 30 Lakhs. This decision was met with intense opposition from automakers and industry experts, who said that such a tax would hinder the state’s efforts to encourage clean mobility.
Deputy Chief Minister and Finance Minister Ajit Pawar first proposed the tax in the state’s 2025-26 budget. However, during a discussion in the Legislative Council, Chief Minister Devendra Fadnavis announced that the idea would not be forwarded.
Fadnavis added that the government had considered taxing high-end EVs since they fall into the luxury segment. However, upon additional analysis, officials discovered that there were very few such vehicles on the market, making the tax meaningless in terms of revenue generation.
EV Growth Is a Concern
Shiv Sena (UBT) leader Anil Parab expressed concerns that imposing additional prices on EV buyers could hinder their adoption. He highlighted that taxing electric cars, particularly those in the premium class, goes against the government’s goal of promoting green mobility.
Fadnavis acknowledged the concerns and stressed that keeping EVs affordable and attractive is a top priority for Maharashtra. “If we go ahead with this tax, it might send the wrong message that we are discouraging EV adoption,” he stated.
EV Push in Maharashtra Continues
While the proposed EV tax has been called off, the government will start further budgetary changes from April 1, 2025. These include a 1% tax increase on CNG and LPG vehicles, as well as a 7% fee on construction and light trucks.
Maharashtra’s position as a prominent player in India’s EV sector is growing, thanks to massive manufacturing facilities in Pune and Chhatrapati Sambhajinagar. The state is also expanding its EV infrastructure by installing more charging stations throughout the cities. In addition, around 2,500 electric buses will be added to public transportation to support clean mobility and reduce pollution.
The Transition From Petrol to EV
The removal of the EV fee has been welcomed by industry stakeholders and environmentalists. Experts believe that tax-free EVs will encourage more people to switch from gasoline and diesel vehicles, hence reducing air pollution. Maharashtra’s decision strengthens its commitment to being a leading hub for electric mobility, ensuring that affordability and sustainability remain at the forefront of its policies.
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