Maharashtra Budget 2026–27: Tax Concessions for New Vehicles, Higher Environmental Tax on Old Cars  

Mumbai: The Maharashtra Budget 2026–27 proposes tax concessions to encourage the scrapping of old vehicles and the purchase of new, less polluting vehicles, while also increasing environmental tax on older private vehicles.

Presenting the Budget in the Legislative Assembly, Chief Minister Devendra Fadnavis announced concessions in motor vehicle tax for citizens who scrap old vehicles and purchase new ones.

Under the proposal, a 16 per cent concession in motor vehicle tax will be available for buyers who scrap old vehicles complying with BS-4 and above emission norms and purchase a new vehicle. For vehicles with BS-3 and below emission norms, the concession will be 30 per cent if the owner scraps the old vehicle and buys a new one.

The government said the measure is aimed at removing older, less fuel-efficient vehicles from the roads and promoting cleaner and more efficient transport options, which will also help improve air quality.

At the same time, the government has proposed doubling the environmental tax on old non-transport private vehicles that fall under BS-4 and below emission norms, citing their higher contribution to air pollution.

The Budget also includes a proposal related to commercial equipment vehicles. The government has proposed to cap the motor vehicle tax on crane-mounted vehicles at a maximum of ₹30 lakh, providing relief to operators in the construction and heavy equipment sector.

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In addition, the government announced changes to the penal provisions under the Maharashtra Stamp Act relating to execution of documents with insufficient stamp duty.

Under the proposed amendment to sections 59, 60, 63A and 68A of the Act, the amount of fine will be revised from ₹5,000 to up to ₹1 lakh, replacing the earlier provisions that also allowed for rigorous imprisonment upon conviction.

According to the government, the revised penalty structure is intended to discourage execution of documents with insufficient stamp duty while bringing the penalty framework in line with current regulatory practices.