Will living in Maharashtra burden you with more expenses?
Well, according to the sources, car buyers will have to pay more taxes while purchasing CNG or EVs in the 2025-26 budget.
Deputy Chief Minister of Maharashtra, Ajit Pawar announced that starting from April 1, 2025, if you drive a passenger car that runs on CNG or LPG, you will notice a 1% tax hike. However, this change does not affect commercial vehicles like buses and autos, which will continue to be exempt.
To be noted, on top of this, electric vehicles that cost Rs 30 lakh or more will now face an extra 6% tax.
What's the Call Behind the Decision?
The tax increase is not random. The state aims to generate an extra Rs 150 crore with this move. Look at the numbers: the CNG market in India has grown significantly over the years.
There are about 7.5 million CNG vehicles today, a market that has tripled since 2016. The growth rate of these vehicles has been around 12% every year.
Moreover, the number of CNG filling stations has exploded from just 1,081 in fiscal year 2016 to over 7,400 in 2025.
This jump shows a growth rate of nearly 24% every year. With these strong numbers, Maharashtra sees a clear chance to raise more funds by increasing the tax on passenger vehicles using these fuels.
What It Means for Car Buyers
For regular car buyers, this news may sting a bit. For every safer option paying 1% extra seems unfair, though, it may seem to be as little as 1% but every bit counts and adds up when millions of vehicles are on the road.
On the other hand, luxury electric vehicles face a steeper challenge. EVs priced at Rs 30 lakh or more will incur a 6% extra tax. This could affect high-end brands like Mercedes, BMW, Audi, and even Tesla.
As these cars are already on the premium side, the added cost might make buyers think twice before choosing a luxury electric vehicle.
Looking at the Bigger Picture
The new tax rules are part of a wider strategy to boost state revenue and encourage a balanced auto market. While there is a focus on collecting extra funds from the booming CNG market, the additional tax on luxury EVs signals that the government wants to keep the premium market in check.
Overall, this move comes at a time when the overall motor vehicle tax already ranges between 7 and 9%, depending on the vehicle type and its price. For the construction industry and light goods transportation, a 7% tax has also been proposed, which is expected to generate Rs 625 crore in additional revenue in the next fiscal year.
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