The Gujarat government has slashed the road tax on electric vehicles from 6 percent to just 1 percent, which translates to an over 83 percentage drop. This benefit will remain valid until March 31, 2026. Tax savings range between Rs 5,000 and Rs 10,000 for two-wheelers, depending on their base price, as per government officials.
- The tax benefit does not apply to hybrid cars
- EV buyers need to register on the Vahan portal to get benefits
New EV tax calculator
To understand the potential savings on a new EV purchase, let’s take the MG Windsor EV as an example. The top-spec Essence variant of the Windsor, priced at Rs 15.50 lakh (ex-showroom, Ahmedabad), was previously subject to a road tax of Rs 93,000. Following the recent revision, this has been reduced to Rs 15,500, resulting in a substantial saving of Rs 77,500. To know about the Windsor EV’s on road price, click here. It should be noted that hybrid cars – including strong and mild hybrids – are not covered under this limited-time tax benefit scheme.
The previously applicable tax rates of 8 percent and 12 percent on passenger vehicles classified under the maxi category have been revised to a uniform rate of 6 percent, based on the seating capacity of the vehicles, the government has notified.
How to get EV tax benefit?
According to state transport officials, the entire process is digitised, so there's no need to visit a physical Regional Transport Office (RTO). Instead, EV buyers can avail of the tax benefit by registering their four-wheelers on the Vahan 4.0 portal.
EV sales fell by 43.5 percent in 2024, dropping to 50,010 units from 88,614 in 2023, as per officials cited by The Economic Times. This decline may be linked to last year's discontinuation of the Rs 25,000 subsidy for electric two-wheelers and Rs 1.5 lakh for four-wheelers priced below Rs 15 lakh. "The decision has been made to boost electric vehicle adoption, protect the environment, and promote the tourism sector," the government said.
Saptarshi Mondal
Hormazd Sorabjee
Sahil Kukreja
