The Maharashtra government has introduced a 6% tax on electric vehicles (EVs) that retail for more than ₹30 lakh. This policy was revealed during the recent budget announcement and is set to take effect on April 1.
Maharashtra Chief Minister Devendra Fadnavis stated that the tax targets luxury EVs priced over ₹30 lakh, leaving more affordable options unaffected. Additionally, the government has raised the tax on Compressed Natural Gas (CNG) vehicles, aiming to collect approximately ₹150 crore in revenue for the fiscal year 2025-26.
Experts have expressed concerns that this new tax could hinder the adoption of electric vehicles, which currently account for only about 2% of passenger vehicle sales in the state. Manish Raj Singhania, Chairman of the Federation of Automobile Dealers Associations (FADA), pointed out that the increased taxes will likely elevate EV prices at a time when the subsidy period for such vehicles is coming to an end. He emphasized that this is an opportune moment to maintain subsidies, especially as manufacturers roll out new EV products. He also mentioned that a reduction in battery costs could help balance out the situation.
