Gujarat Govt Introduces 1 Per Cent Vehicle Tax For EVs Till March 2026

The Gujarat Government wants to see more EV on the road. To do so, it has introduced a 5 per cent vehicle tax exemption for all buyers of both electric two- and four-wheelers until March 2026. As per the exemption tax, buyers will have to pay 1 per cent vehicle tax on any e-2W or 4W purchase. 

Along with tax exemption, the state government has also completely digitised the vehicle registration process by moving it to Vahan 4.0. By doing so, potential customers will also be able to avail tax benefits. Four-wheelers will attract the maximum savings, while two-wheelers have been estimated to return savings between ₹5,000 to ₹10,000. 

(Also Read: EV Adoption Continuous To Face Roadblocks In India: Deloitte Report)

The latest move from the Gujarat Government was drawn up to address the decline in EV sales in the state. In 2024, EV sales comprised just 50,010 units. This was 43.5 per cent less compared to 88,614 unit sales the state registered in 2023. 

(Also Read: Maharashtra Government Scraps Proposed 6% Tax on High-End EVs Amid Backlash)

To further ease the transition of commercial fleet to an all-EV fleet, the state government has also reduced tax on maxi cabs from 8 per cent and 12 per cent to just 6 per cent. This should in turn further help the tourism industry bloom in the state, with less running costs.