Maharashtra Assembly Unanimously Passes Motor Vehicle Tax Bill To Curb Pollution And Boost Revenue

Mumbai: Maharashtra Legislative Assembly on Wednesday unanimously passed the Maharashtra Motor Vehicles Tax (Amendment) Bill, 2026. The legislation is aimed at striking a balance between environmental protection, fiscal discipline and industrial development.

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Higher Environmental Tax on Ageing Two-Wheelers and Cars

Transport Minister Pratap Sarnaik informed the House that the bill introduces a revised tax structure to curb rising air pollution caused by ageing and highly polluting vehicles. As per the new provisions, the environmental tax on two-wheelers has been increased from Rs 2,000 to Rs 4,000, while petrol vehicles will now attract Rs 6,000, up from Rs 3,000. Similarly, diesel vehicles will be taxed Rs 7,000 instead of the earlier Rs 3,500. This tax will be collected as a one-time payment valid for five years.

Highlighting the financial impact, the minister said the revised tax regime is expected to generate more than Rs160 crore in additional revenue annually. The funds will be channelled into key areas such as road safety enhancement, development of modern transport infrastructure, strengthening of ATS (Automated Testing Stations) systems, and capacity-building through training initiatives.

Rs 30 Lakh Tax Cap on Cranes to Boost Construction Sector

In a move to support the industrial and infrastructure sectors, the government has also introduced a cap of Rs 30 lakh on motor vehicle tax for crane vehicles. This is expected to reduce the financial burden on construction companies and infrastructure developers, thereby encouraging investment and accelerating project execution across the state.

The minister further stated that the amendment is designed to promote a shift towards cleaner mobility solutions. By increasing the cost of operating older, polluting vehicles, the government aims to encourage citizens to adopt BS-VI compliant and electric vehicles, contributing to improved air quality and long-term environmental sustainability.

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Infrastructure Push to Generate Rural Employment

Additionally, the policy is likely to have a positive socio-economic impact by generating employment opportunities, particularly in rural and tribal regions, through the expansion of transport infrastructure and allied services.

Importantly, the government clarified that the bill will not place any additional burden on the state’s consolidated fund. Instead, it is expected to strengthen the state’s revenue position while advancing its environmental and developmental goals.

The bill received broad support across party lines, with members of the House welcoming the initiative and passing it unanimously.

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