Maharashtra government drops proposed 6% tax on high-end EVs

Maharashtra CM cancels 6% tax on high-end EVs above ₹30 lakh due to concerns over impact on adoption and revenue.

Maharashtra Chief Minister Devendra Fadnavis on Wednesday (March 26, 2025) announced that the state government will not implement the proposed 6% tax on electric vehicles (EVs) priced above ₹30 lakh. The decision was made after concerns were raised about its impact on EV adoption and revenue generation.

The announcement came during a discussion on EVs and air pollution in the Legislative Council, in response to a query by Shiv Sena (UBT) leader Anil Parab. Mr. Parab argued that the proposed tax would contradict the Centre’s efforts to promote clean mobility. “Levying a 6% tax on high-end EVs would be counterproductive,” he said.

Mr. Fadnavis acknowledged the concern and said the government had reconsidered its stance. “The tax would not generate significant revenue and could send the wrong signal about our commitment to electric mobility. Therefore, we will not proceed with it,” he stated.

The tax proposal was initially introduced in the state’s budget for 2025-26.

Earlier in the session, the Chief Minister highlighted Maharashtra’s growing status as a key hub for EV manufacturing, with major plants coming up in Pune and Chhatrapati Sambhajinagar. He stated that the shift from petrol and diesel vehicles to EVs would significantly reduce air pollution, as conventional vehicles are the biggest contributors.

“Maharashtra is becoming the national capital of electric vehicles,” he said, adding that both private and public transport sectors were increasingly adopting EVs. Over 2,500 electric buses are being introduced in phases, and more than 50% of newly registered vehicles in the state are now electric, he noted.