Where is the subsidy available on the purchase of EV, what is the exemption in road tax registration

TV9 Hindi

If you buy an EV by taking a loan, then the interest on the loan is tax exempted. Under the Income Tax Act, a deduction of up to Rs 1.5 lakh can be taken on this interest. Under 80EEB, tax exemption is given on the interest on the loan against the purchase of EV.

Aug 15, 2022 | 9:04 am

TV9 Bharatvarsh | Edited By:


Aug 15, 2022 | 9:04 am




To promote Electric Vehicle (EV), many state governments are giving subsidy on the purchase of such vehicles. Maharashtra tops the list where maximum subsidy is being given on the purchase of EVs. The first 10,000 buyers are being given a subsidy of Rs 1.5 lakh on the purchase of a four wheeler EV. Similarly, a subsidy of Rs 10,000 is being given on the purchase of two wheelers. Road tax has been waived in most states ever since the EV policy came into force. It does not include Gujarat and Kerala where 50% discount of the total road tax amount is given.

To promote Electric Vehicle (EV), many state governments are giving subsidy on the purchase of such vehicles. Maharashtra tops the list where maximum subsidy is being given on the purchase of EVs. The first 10,000 buyers are being given a subsidy of Rs 1.5 lakh on the purchase of a four wheeler EV. Similarly, a subsidy of Rs 10,000 is being given on the purchase of two wheelers. Ever since the EV policy came into force, road tax has been waived in most states. It does not include Gujarat and Kerala where 50% discount of the total road tax amount is given.

If you buy an EV by taking a loan, then the interest on the loan is tax exempted. Under the Income Tax Act, a deduction of up to Rs 1.5 lakh can be taken on this interest. Under the Income Tax Act 80EEB, the interest on loan on purchase of EV is exempted from tax. The central government charges the lowest 5% GST on the purchase of EVs. Along with this, Maharashtra has waived off road tax and registration fee for EVs.

If you buy an EV by taking a loan, then the interest on the loan is tax exempted. Under the Income Tax Act, a deduction of up to Rs 1.5 lakh can be taken on this interest. Under the Income Tax Act 80EEB, the interest on loan on purchase of EV is exempted from tax. The central government charges the lowest 5% GST on the purchase of EVs. Along with this, Maharashtra has waived off road tax and registration fee for EVs.

Most states in the country have capped the total number of subsidized electric cars at 10,000 units. The ex-factory cost limit for vehicles falling in this category has been pegged at Rs 15 lakh, which means that currently, it is only Tata Tigor EV Ziptron and Tata Nexon EV that are eligible for subsidy in all states. Larger, more expensive EVs like the MG ZS EV and Hyundai Kona Electric are not eligible for these subsidies. Maharashtra is at the fore in this list where incentive is being given at the rate of Rs 5,000 per kWh. For four wheeler EVs, this amount is fixed at 1.5 lakhs.

Most states in the country have capped the total number of subsidized electric cars at 10,000 units. The ex-factory cost limit for vehicles falling in this category has been pegged at Rs 15 lakh, which means that currently, it is only Tata Tigor EV Ziptron and Tata Nexon EV that are eligible for subsidy in all states. Larger, more expensive EVs like the MG ZS EV and Hyundai Kona Electric are not eligible for these subsidies. Maharashtra is at the fore in this list where incentive is being given at the rate of Rs 5,000 per kWh. For four wheeler EVs, this amount is fixed at 1.5 lakhs.

Gujarat, Assam and West Bengal offer an incentive of Rs 10,000 per kWh, but the total subsidy is limited to Rs 1.50 lakh. The same amount is offered on the purchase of EVs in Delhi as well and Bihar's yet notified EV policy also describes similar benefits. Odisha offers an incentive of up to Rs 1 lakh for electric vehicles, while Meghalaya - with an incentive of Rs 4,000 per kWh - provides a total subsidy of Rs 60,000.

Gujarat, Assam and West Bengal offer an incentive of Rs 10,000 per kWh, but the total subsidy is limited to Rs 1.50 lakh. The same amount is offered on the purchase of EVs in Delhi as well and Bihar’s yet notified EV policy also describes similar benefits. Odisha offers an incentive of up to Rs 1 lakh for electric vehicles, while Meghalaya – with an incentive of Rs 4,000 per kWh – provides a total subsidy of Rs 60,000.

Rajasthan, Andhra Pradesh, Karnataka, Madhya Pradesh, Telangana, Tamil Nadu, Uttarakhand, Punjab and Uttar Pradesh do not provide direct subsidies for electric cars and SUVs in their policies, but exempt road tax and registration fees. Registration charges have been waived off for all types of electric vehicles across the country. In August last year, the Ministry of Road Transport and Highways (MoRTH) announced that all battery-operated vehicles were exempted from 'issuance of registration certificate or payment of registration renewal charge'.

Rajasthan, Andhra Pradesh, Karnataka, Madhya Pradesh, Telangana, Tamil Nadu, Uttarakhand, Punjab and Uttar Pradesh do not provide direct subsidies for electric cars and SUVs in their policies, but exempt road tax and registration fees. Registration charges have been waived off for all types of electric vehicles across the country. In August last year, the Ministry of Road Transport and Highways (MoRTH) announced that all battery-operated vehicles were exempted from ‘issuance of registration certificate or payment of registration renewal charge’.






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