Maharashtra scraps 6% tax on luxury EVs after backlash from carmakers, public

The tax was part of the 2025-26 state budget, presented by Deputy CM and Finance Minister Ajit Pawar, to raise extra funds. However, carmakers and others pushed back, saying it would clash with efforts to boost EV use and cut pollution.

During a council debate on EVs and air pollution, Shiv Sena (UBT) leader Anil Parab questioned the tax. He said, “The Maharashtra government’s proposal to levy a 6% tax on EVs priced over ₹30 lakh would go against the aim of promoting cleaner vehicles.”
In reply, Fadnavis said the tax wouldn’t bring in much money and might hurt the state’s EV push. “It could suggest we’re against EV adoption. So, the state government has decided not to go ahead with the 6% tax on costly electric vehicles,” he explained.

While the EV tax is scrapped, other budget changes will go ahead from April 1, 2025. These include a 1% tax rise on CNG and LPG vehicles and a 7% tax on construction and light goods vehicles.

Fadnavis highlighted that Maharashtra is growing as a key EV centre, with new factories in Pune and Chhatrapati Sambhajinagar. He added that over half of the state’s newly registered vehicles are now EVs.

The government is also setting up charging stations across Maharashtra. Plus, over 2,500 electric buses will join the public transport system in stages. Fadnavis stressed that moving to EVs will help tackle air pollution, as petrol and diesel vehicles are a big cause of it.