In a decisive push towards encouraging eco-friendly transportation, the Central Government has formally urged all state governments to abolish additional road tax levied on electric vehicles (EVs). The directive, issued by the Ministry of Road Transport and Highways (MoRTH), is part of a broader national strategy to accelerate EV adoption, reduce dependence on fossil fuels, and meet India’s clean mobility and climate goals. Authorities highlighted that such additional levies discourage buyers from choosing zero-emission alternatives, contradicting both central and state-level sustainability efforts.

The ministry emphasized that many states continue to impose extra charges or full road tax rates on electric vehicles despite previous advisories suggesting tax exemptions or significant reductions. By removing these financial disincentives, the government expects to boost consumer confidence and increase EV penetration, especially in urban and commercial segments. It also pointed out that lower operational costs are among the biggest selling points of EVs, and tax burdens could undermine their long-term viability in the eyes of prospective buyers.

Several states have already complied by offering complete road tax waivers, while others are yet to amend their local transport rules. The central advisory recommends immediate action and also proposes exploring fiscal incentives or subsidies for early adopters. Moreover, the centre hinted that it may introduce performance-linked grants or infrastructure support to states that show leadership in EV-friendly reforms. The move is expected to significantly contribute to India’s target of creating a robust electric vehicle ecosystem over the next decade.