Are you planning to buy a new car? Purchasing a vehicle has become more expensive as of today (July 1). Recently, the government has made changes to the Maharashtra Motor Vehicle Tax Act, 1958. Now, as per the revised tax structure introduced through the Maharashtra Motor Vehicle Tax (Amendment) Act, 2025, the purchase of high-end cars, CNG/LNG vehicles, and goods carriers, due to a significant increase in one-time tax rates, will be affected. These new changes are expected to create an impact on vehicle buyers, especially those who are buying luxury and commercial vehicles. Furthermore, the price bracket cap utilised for tax computations increased from Rs 20 lakh to Rs 30 lakh by the new regulations, which led to a significant increase in taxes for cars costing more than Rs 20 lakh.
Under the updated structure, petrol cars that are registered under an individual’s name will bear one-time taxes of 11% for the vehicles that cost below Rs 10 lakh, 12% for those between Rs 10 lakh to Rs 20 lakh. The vehicles that cost over Rs 20 lakh will bear one-time taxes of 13%. For these same price brackets, diesel cars will see tax rates of 13%, 14%, and 15% respectively.
The one-time tax threshold was raised from Rs 20 lakh to Rs 30 lakh, which is a significant change. This implies that premium cars costing more than Rs 20 lakh will increase in price by at least Rs 10 lakh. High-end diesel and petrol vehicles that cost more than Rs 1.30 crore and Rs 1.50 crore, respectively, will now be subject to a one-time tax of almost Rs 20 lakh.
Both petrol and diesel vehicles that are imported or registered under corporate names are subject to a 20% flat one-time tax, regardless of price.
There will also be a slight increase for CNG and LNG vehicles, with a 1% one-time tax increase for all price ranges.
Construction equipment, including cranes, compressors, and projectors, as well as goods carriers like pickup trucks and tempos with a gross vehicle weight of up to 7,500 kg, will henceforth be subject to price-based taxes rather than weight-based ones. These vehicles now have a 10% tax charge instead of the previous 7%. A Rs 10 lakh pickup vehicle, for instance, that previously incurred a weight-based tax of Rs 20,000 will now pay almost Rs 70,000 in taxes under the new system.
Does the Maharashtra Motor Vehicle Tax (Amendment) Act, 2025, affect the prices of Electric Vehicles?No. Electric vehicles (EVs) are exempted from this new amendment. Initially, a proposal to impose 6% tax on EVs worth more than Rs 30 lakhs was imposed, but later the government decided to withdraw the rule.
What are the Key Changes in the Motor Vehicle Tax Act?
- For tax calculations, the vehicle price bracket was raised from Rs 20 lakh to Rs 30 lakh.
- All pricing ranges saw an increase in the one-time tax rates for petrol and diesel vehicles.
- For construction vehicles and light goods vehicles weighing less than 7,500 kg, a new category was created.
- The tax rate for goods transporters was raised from 7% to 10% and is now determined by price rather than weight.
- EVs are exempted from these new rules.
A notification was issued by the Maharashtra Transport Commissioner on June 25, 2025, that stated the new amendment act will be implemented from July 1, except for Section 5(2), which remains excluded.