Electric cars and private EVs will now attract up to 10% lifetime road tax, while two-wheelers remain exempt under the amended policy.
The Karnataka government has officially brought electric vehicles (EVs) under a lifetime road tax framework after notifying the Karnataka Motor Vehicles Taxation (Amendment) Act, 2026. The move marks a significant policy shift as EVs in the state previously enjoyed complete road tax exemption.
The revised taxation applies to electric cars, jeeps, buses and other private EV categories, while electric two-wheelers will continue to remain exempt from road tax.
New Tax Slabs for EV Buyers
Under the amended structure, lifetime road tax will be calculated based on the vehicle’s ex-showroom price and collected at the time of registration:
- EVs priced below ₹10 lakh: 5% tax
- EVs priced between ₹10 lakh and ₹25 lakh: 8% tax
- EVs priced above ₹25 lakh: 10% tax
This replaces the earlier policy under which EV owners paid no road tax at all.
Impact on Existing Vehicles
For already registered electric vehicles, the government will levy a proportionate lifetime tax ranging between 93% and 25% of the total applicable tax amount, depending on the vehicle’s age. Older vehicles will attract lower tax liability.
Revenue Push Behind Policy Change
The state government expects the amendment to generate approximately ₹250 crore in additional revenue.
Industry Concerns
Before the notification, multiple electric vehicle manufacturers had approached Chief Minister Siddaramaiah seeking relief. Automakers argued that EV adoption in India is still developing and additional taxation could narrow the price advantage EVs hold over internal combustion engine (ICE) vehicles.
Karnataka had first introduced road tax exemptions in 2016 to accelerate electric mobility adoption and encourage early market growth.
EV Adoption Still Rising
Despite policy shifts, electric vehicle demand across India continues to expand. Rising fuel price concerns and global supply uncertainties have strengthened consumer interest in electric mobility. In March, EV registrations nationwide surged 46% month-on-month, reaching nearly 2.8 lakh units, highlighting growing momentum in the transition toward cleaner transportation.
