TL;DR
Karnataka is withdrawing its 100% road tax exemption for electric cars from April 1, 2026, introducing a 5-10% lifetime tax based on vehicle price, though electric two-wheelers remain exempt.
The state of Karnataka is set to implement a new tax regime for electric vehicles (EVs) starting April 1, 2026, effectively withdrawing the 100% road tax exemption previously offered for battery-operated cars. This policy shift means that EVs will now incur a lifetime tax ranging from 5% to 10%, depending on their ex-showroom price. Electric cars priced under Rs 10 lakh will be taxed at 5%, those between Rs 10 lakh and Rs 25 lakh at 8%, and EVs above Rs 25 lakh will face a 10% tax at the time of registration.
This decision, part of the Karnataka Motor Vehicles Taxation Amendment Bill 2026, marks a significant departure from the state's long-standing EV-friendly policies aimed at promoting green mobility. The move is expected to generate an estimated Rs 259 crore annually for the transport department. While this will undoubtedly make electric cars more expensive in Karnataka, tax exemptions for electric two-wheelers will continue. Meanwhile, some dealers are offering substantial discounts on Mahindra's BE6 and XEV 9e electric SUVs for buyers registering before March 31st to mitigate the impact of the upcoming taxes.
