Good news! This state slashes EV road tax to just 1% till March ‘26: Details
The Gujarat government has announced a fresh incentive for electric vehicle buyers. Fully electric vehicles in the state will now be eligible for a 5% tax exemption, bringing the effective tax rate down to just 1%. The benefit will remain in effect until March 31, 2026, reported IANS.
The announcement was made by Harsh Sanghavi, Minister of State for Home and Transport, who described it as a “citizen-centric step” aimed at promoting eco-friendly mobility solutions.
This tax relief is expected to ease the financial load on EV buyers and further accelerate electric vehicle adoption across the state. Citizens can claim the benefit directly through the online Vahan 4.0 portal, making the process simple and transparent.
Gujarat EV Policy and sales
The move complements the broader EV ecosystem that Gujarat has been steadily building under its Electric Vehicle Policy 2021. Backed by a budget of Rs 870 crore, the policy aims to make Gujarat a leader in EV adoption and manufacturing. It targets the deployment of 2 lakh electric vehicles across categories — including 1.10 lakh two-wheelers, 70,000 three-wheelers, and 20,000 four-wheelers — by the end of 2025.
The environmental impact of this policy is notable. The government estimates a reduction of nearly 6 lakh tonnes in carbon emissions, along with fuel savings of around Rs 5 crore over the policy’s duration.
Infrastructure is also a key focus. Gujarat is encouraging private investment in EV charging stations by offering subsidised electricity tariffs and incentives. Additionally, the state is building a strong EV manufacturing base, with a Rs 7,300 crore lithium-ion battery plant currently being developed in Ahmedabad.
As of April 2025, the state has already registered over 2.64 lakh electric vehicles and introduced more than 800 electric buses across various districts.
