Maharashtra Doubles Vehicle Environment Tax to Curb Air Pollution

The Maharashtra government has doubled environmental tax on older vehicles, targeting rising pollution levels and encouraging a shift toward cleaner and more sustainable transport options.

Vehicles | March 19, 2026: In a significant step to tackle rising air pollution, the Maharashtra government has approved an amendment to the Motor Vehicles Tax Act, doubling the environmental (green) tax on older and more polluting vehicles across the state.

Under the revised structure, the environmental tax on two-wheelers has been increased from ₹2,000 to ₹4,000. Similarly, petrol vehicles will now attract ₹6,000 instead of ₹3,000, while diesel vehicles will be charged ₹7,000, up from ₹3,500. The tax will be collected as a one-time payment valid for five years.

The move is part of the state’s broader strategy to reduce vehicular pollution, which has been a growing concern in urban centres such as Mumbai, Pune and Nagpur. Officials said older vehicles, especially those compliant with outdated emission norms like BS-3 and BS-4, contribute significantly to air pollution and need to be phased out gradually.

The amendment was passed in the state legislature as part of the Maharashtra Motor Vehicles Tax (Amendment) Bill, 2026. Authorities emphasised that the decision aims to strike a balance between environmental protection and sustainable development, while also improving public health outcomes.

In addition to increasing the tax burden on older vehicles, the government is also encouraging vehicle owners to adopt cleaner alternatives. Incentives are being offered under the scrappage policy, where individuals who scrap old vehicles and purchase new ones can avail tax concessions. These benefits range from around 16% to 30%, depending on the category and age of the scrapped vehicle.

Transport officials stated that the policy is designed to discourage the continued use of fuel-inefficient and high-emission vehicles, while promoting newer, eco-friendly models, including BS-6 compliant and electric vehicles.

The revised tax is also expected to generate additional revenue for the state, estimated at over ₹160 crore annually. This revenue will be utilised for improving road safety infrastructure, strengthening transport systems and implementing modern traffic management technologies.

Experts believe the decision aligns with national efforts to modernise the vehicle fleet and reduce pollution levels in rapidly urbanising regions. However, some vehicle owners have expressed concerns over increased costs, particularly for those dependent on older vehicles for daily commuting.

Officials have clarified that while the tax hike may increase financial pressure in the short term, it is a necessary step to address long-term environmental challenges and improve air quality across the state.

With stricter enforcement and complementary policies in place, the government hopes the move will accelerate the transition toward cleaner mobility and contribute to a healthier urban environment.

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