Maharashtra introduces a 6% tax on electric vehicles priced above ₹30 lakh and a 1% tax increase on CNG and LPG cars, impacting commuters. The policy aims to boost state revenue but has sparked concerns about rising travel costs.
From July 1, 2025, vehicle owners in Maharashtra face higher costs due to a new tax structure announced in the state’s 2025-26 budget. Electric vehicles (EVs) priced over ₹30 lakh, previously exempt from road taxes, will now incur a 6% tax, affecting luxury models from brands like Hyundai, Kia, and BYD. This marks a shift from Maharashtra’s earlier push for EV adoption through subsidies, raising worries among buyers about increased expenses for eco-friendly options. The tax targets high-end EVs, leaving more affordable models unaffected to encourage broader clean mobility.
Additionally, privately owned non-transport CNG and LPG four-wheelers will see a 1% tax hike, raising the rate from 7-9% to 8-10%. This change, expected to generate ₹150 crore, adds to the financial burden for families relying on these fuel-efficient vehicles. The state has also raised the motor vehicle tax cap from ₹20 lakh to ₹30 lakh, meaning high-value cars, including petrol and diesel models, could face taxes exceeding ₹20 lakh for vehicles priced around ₹1.33 crore to ₹1.54 crore. This is projected to bring in ₹170 crore.
Construction vehicles like cranes and excavators, along with light goods vehicles up to 7,500 kg, will face a new 7% tax, adding ₹180 crore and ₹625 crore to state coffers, respectively. While these measures aim to fund state initiatives, they’ve raised concerns about affordability, especially for small businesses and individual buyers. Notably, a proposed 6% EV tax was scrapped in March 2025 after debates, but the reintroduced policy has reignited discussions about balancing revenue needs with environmental goals, leaving commuters and businesses navigating a costlier road ahead.
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