Daijiworld Media Network - Mumbai

Mumbai, Mar 26: Maharashtra Chief Minister Devendra Fadnavis announced on Wednesday that the proposed 6% tax on electric vehicles (EVs) priced above ?30 lakh will be withdrawn. The decision comes after industry stakeholders and policymakers raised concerns over its potential impact on EV adoption.

The tax, originally proposed by Deputy CM and Finance Minister Ajit Pawar in the 2025-26 state budget, was intended to generate additional revenue. However, during a discussion on EVs and air pollution in the state council, Shiv Sena (UBT) legislator Anil Parab questioned the rationale behind imposing a levy on luxury EVs when both the Centre and state government are actively promoting clean mobility.

Parab argued that taxing high-end EVs would be counterproductive, as it contradicts the government’s push for a pollution-free transport ecosystem. He highlighted that the Central government has introduced various incentives to boost EV adoption, and imposing a state-level tax would discourage potential buyers.

Responding to these concerns, CM Fadnavis acknowledged that the tax would not generate substantial revenue and could send the wrong message about Maharashtra’s commitment to electric mobility. "After careful consideration, we have decided not to implement the 6% tax on EVs priced above ?30 lakh," he confirmed.

The tax was set to take effect from April 1, 2025, as part of the state budget proposals announced on March 10. Alongside the EV tax, the budget also suggested:

• A 1% tax hike on individual-owned non-transport CNG and LPG four-wheelers
• A 7% tax on light goods vehicles (LGVs) carrying goods up to 7,500 kg, aimed at generating ?625 crore

The now-scrapped EV tax was expected to contribute ?150 crore in additional revenue for FY 2025-26. However, in light of public and industry opposition, the government has chosen to prioritize its long-term clean energy goals over short-term revenue gains.