The Maharashtra government has proposed a 100 percent increase in the environmental, or “green,” tax on older private vehicles in a major push to combat pollution and modernize the state’s vehicle fleet. Announced by Chief Minister Devendra Fadnavis during the 2026 state budget presentation, the measure specifically targets aging vehicles that meet BS4 and older emission standards. Under the new proposal, the green tax for two-wheelers will double from Rs 2,000 to Rs 4,000. Similarly, the tax for petrol light motor vehicles (LMVs) will rise from Rs 3,000 to Rs 6,000, while the tax on diesel LMVs will increase from Rs 3,500 to Rs 7,000. The government also noted that enforcement of these taxes, along with mandatory fitness certificate checks, will be strictly tightened.
To balance these stringent tax hikes and encourage the removal of heavily polluting vehicles from the roads, the state is offering substantial scrappage incentives. Vehicle owners who choose to scrap their old vehicles and purchase new ones will be eligible for motor vehicle tax concessions. Specifically, buyers scrapping a vehicle compliant with BS4 or higher emission norms will receive a 16 percent tax concession on their new purchase. For those scrapping older, BS3 or lower compliant vehicles, the concession increases significantly to 30 percent. Together, these measures are designed to discourage the use of fuel-inefficient vehicles and accelerate the transition toward cleaner transportation across Maharashtra.
