TL;DR
Tamil Nadu has extended its 100% road tax exemption for all electric vehicles until December 31, 2027, to further boost EV adoption and manufacturing in the state.
In a significant boost for electric vehicle (EV) adoption, the Tamil Nadu government has extended its 100% motor vehicle tax exemption for all categories of EVs for an additional two years. This exemption, applicable to both transport and non-transport battery-operated vehicles, will now remain in effect from January 1, 2026, until December 31, 2027.
The decision, announced through a government notification, aims to provide continued cost relief to EV buyers and greater policy certainty for manufacturers. This move aligns with the Tamil Nadu Electric Vehicle Policy, 2023, and follows strong representations from EV manufacturers and industry stakeholders who emphasized the growing momentum of EV adoption, which reached approximately 7.8% in Tamil Nadu in 2025.
The extension is expected to enhance the affordability of electric two-wheelers, cars, and commercial EVs, as motor vehicle tax can significantly contribute to the on-road cost. By extending this incentive, Tamil Nadu reinforces its commitment to fostering a robust EV ecosystem and maintaining its position as one of India's most EV-friendly states, while also planning a detailed study on future tax implications.
