Electric vehicles to get expensive in Maharashtra? Will Hyundai, Kia, BYD be impacted?
Maharashtra proposes a 6% tax on EVs above Rs 30 lakh, impacting Hyundai, Kia, and BYD. Tesla's entry into India is imminent, but its initial models may avoid the tax.
FollowThe Maharashtra government has proposed an additional 6% tax on electric vehicles (EVs) priced above Rs 30 lakh (ex-showroom) in the state. Although the proposal was included in the state's 2025–2026 fiscal year budget, it will take effect on April 1. In contrast to internal combustion engine (ICE) models, which are subject to a 28% GST bracket, electric vehicles (EVs) in India are subject to a 5% GST.
In India, the EV market is still rather little. Only 3% of all automobiles sold in India in February 2025 were electric vehicles, according to figures from the Federation of Automobile Dealers Associations (FADA), an industry association.
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Nonetheless, the Indian government is actively promoting the use of EVs, setting a 2030 automobile penetration goal of 30%. The action was taken just before Elon Musk's Tesla is set to launch its first showroom in India at the Bandra Kurla Complex in Mumbai. However, since its first electric vehicle for the Indian market may cost less than Rs 30 lakh (ex-showroom), Tesla may not be affected.
According to reports, the EV behemoth has no imminent plans to begin producing electric vehicles in India; instead, they would be imported from Germany. Since they sell electric vehicles with ex-showroom pricing in the region of Rs 30 lakh, mass market manufacturers like Hyundai (Ioniq 5), Kia (EV6), and BYD (Seal and Sealion 7) are expected to be impacted by the Maharashtra government's decision to impose an extra 6% tax on EVs.
Tesla's entry in India
Earlier, it was announced that American electric vehicle manufacturer Tesla has leased a 4,000-square-foot building in the Bandra Kurla Complex business hub to host its first showroom in the nation. The company, which is run by billionaire Elon Musk, would be paying more than Rs 35 lakh a month for the property, which also includes a few parking spots, according to documents made public by CRE Matrix.
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