Maharashtra Govt Doubles Vehicle Environment Tax to Fight Air Pollution, Targets Rising Pollution From Old Vehicles

Mumbai, March 18, 2026: The Maharashtra legislature on Wednesday passed the Maharashtra Motor Vehicles Tax (Amendment) Bill, 2026, effectively doubling the environmental tax on vehicles as part of the state’s push to curb rising air pollution.

With the amendment, 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 instead of Rs 3,000, and diesel vehicles Rs 7,000, up from Rs 3,500. The revised tax will be collected as a one-time charge for a period of five years.

Transport Minister Pratap Sarnaik said the move is aimed at discouraging the use of older, polluting vehicles and improving air quality. He added that the revised tax structure is expected to generate over Rs 160 crore in additional annual revenue, which will be used for road safety initiatives, modern transport infrastructure, ATS systems and training.

The legislation also includes measures to support the industrial sector, as the government has capped motor vehicle tax on crane vehicles at Rs 30 lakh. This is expected to provide relief to the construction and infrastructure sectors and encourage further investment.

The government is also banking on the amendment to accelerate the transition to Bharat Stage (BS)-VI and electric vehicles, while creating employment opportunities, especially in rural and tribal areas.

Sarnaik said the Bill would not place any additional burden on the state’s consolidated fund and would instead strengthen revenue streams. The amendment received unanimous support from members across party lines, with the government describing it as a key step towards sustainable and balanced development.