State FM Ajit Pawar said that the proposed taxes on EVs will help the state government generate an additional INR 170 crore in revenues annually

At the lower end of the spectrum, the customers will now have to shell out an additional INR 1.8 Lakhs for an EV priced at INR 30 Lakhs

The announcement comes just days after reports surfaced that Tesla signed a lease agreement for a showroom space in Mumbai’s BKC

The Maharashtra government has announced plans to levy a “vehicle tax” of 6% on electric vehicles (EVs) priced above INR 30 Lakh.

“It is proposed to levy motor vehicle tax at the rate of 6% on electric vehicles priced above Rs. 30 lakhs,” said state finance minister (FM) Ajit Pawar during his budget speech on Monday (March 10).

The changes will be implemented starting April 1. As per a report in The New Indian Express, Pawar said that the proposed taxes on EVs will help the state government generate an additional INR 170 Cr annually.

As per media reports, Maharashtra chief minister Devendra Fadnavis said, “The tax is levied only on EVs which are priced above INR 30 Lakh because it’s luxury and not below that”.

The vehicle tax is expected to drive up costs of luxury EVs in the state, especially for the end customers. At the lower end of the spectrum, the customers will now have to shell out an additional INR 1.8 Lakh for an EV priced at INR 30 Lakh.

However, to foster mass adoption of electric vehicles in the state, the government has kept affordable EVs outside the ambit of the new levy.

This also came on the same day as Pawar, in his budget speech, announced the establishment of an AI-led “command control centre” to curb crimes in the Mumbai city, provide quick emergency responses and ensure effective public safety.

He also proposed plans for developing a strategy, with an outlay of INR 500 Cr, to leverage AI to boost the local agriculture sector. Additionally, the state budget also proposed establishing the Maharashtra Cyber Crime Security Corporation to “supply expert manpower for cyber security”.

The new vehicle taxes on EVs, above INR 30 Lakh, comes at a time when one of the world’s largest electric automaker Tesla is looking to enter India. The announcement comes just days after reports claimed that the Elon Musk-led company signed a lease agreement for a showroom space in Mumbai’s BKC.

Not just Tesla, other carmakers such as BMW, Audi, Mercedes, Hyundai and BYD could also feel the pinch as the new levies drive up costs for high-end EVs in the state.