Uttar Pradesh Government to Consider Reinstating Expired EV Tax Rebate, Expanding Exemptions for Fleet Operators

The High-Level Authorized Electric Vehicle Committee (HLEEVC), under the Government of Uttar Pradesh, is considering an extension of its recently expired 100 percent rebate on  road tax and registration fees for passenger EV purchases, ACKO Drive has learnt. As per the original provisions of the Uttar Pradesh Electric Vehicle Manufacturing and Mobility Policy (2022), the exemptions which went into effect in 2002 were only to be valid for a period of three years, and therefore lapsed on October 14.

The original policy specified a 100 percent rebate on any EV purchased and registered in Uttar Pradesh for a period of 3 years from the date of policy notification, with an additional clause for the fourth and fifth years specifying that vehicles also have to be manufactured in the state to qualify. The policy was enacted in order to incentivise companies to set up production facilities in the state. However, large-scale manufacturing for electric and hybrid passenger vehicles has not taken off to the extent projected in 2022.

While attracting investments in manufacturing from the auto industry remains a priority, it could take several more years for new and upcoming facilities to become fully operational. Therefore, the committee has recommended an extension to the original terms, dropping the sub-clause regarding manufacturing.

ACKO Drive’s source references benchmarks including Delhi, Maharashtra, and Karnataka, which offer 100 percent exemptions on registration fees and road tax to encourage EV adoption. With the growing popularity of EVs, it also includes UP state vehicle registration data, stating that 5,35,937 EVs in total were registered between April 1, 2024, and October 8, 2025, of which 96.2 percent were battery electric vehicles (BEVs), while SHEVs and PHEVs accounted for 3.8 percent combined. The committee asserts that BEVs are more aligned with sustainability and energy security goals than hybrids, and should be promoted strategically.

The policy was updated in 2024 to define electric vehicles as "all automobiles using an electric motor that is driven by either batteries, ultra-capacitors, or fuel cells. This includes all 2-wheeler, 3-wheeler and 4-wheeler Strong Electric Vehicles (HEVs), Plug in Hybrid Electric Vehicles (PHEV), Battery Electric Vehicles (BEV), and Fuel Cell Electric Vehicle (FCEV)."

Another key amendment recommended by the committee is that purchase subsidies for electric buses and goods carriers should be extended to 25 units from the current cap at five units, in order to encourage EV adoption by fleet operators and aggregators. This will be in addition to the existing quota of 10 units of 2-wheeler, 3-wheeler, or 4-wheeler vehicles for fleet operators.

Following the Committee’s meeting on October 10, recommendations have been sent to the UP State Chief Minister for approval.

At present, there are no large-scale passenger EV manufacturing facilities in the state. Ashok Leyland is set to begin producing electric buses at a newly set up greenfield manufacturing unit near Lucknow by November this year, with plans to scale its investments up to ₹1,000 crore and produce up to 5,000 units per year, including for its Switch Mobility arm. Tata Motors Commercial Vehicles also builds electric buses at a facility near Lucknow. 

Other players that have recently announced investments in the state include Servotech Power Systems Ltd with an EV charger plant, and Japan’s Denso Corporation with a motor generator plant. Multiple other allied industries and SMEs in the EV space are also present. 

In June this year, the state launched a 500-acre industrial park for EV manufacturing near Kanpur, with an estimated investment of ₹700 crore under the state’s Vision 2030 initiative. It will encourage component and battery manufacturing, as well as research and development facilities.