The budget outlines incentives for scrapping older vehicles, a hike in environmental tax on certain ageing private vehicles, and financial relief measures for farmers, among other key announcements
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The Maharashtra government has proposed a series of measures to reduce vehicular pollution and modernise the state’s vehicle fleet, including tax concessions for people who scrap old vehicles and purchase new ones. The proposals were announced by Chief Minister Devendra Fadnavis while presenting the Maharashtra Budget 2026–27 in the state assembly on Friday.
The budget outlines incentives for scrapping older vehicles, a hike in environmental tax on certain ageing private vehicles, and financial relief measures for farmers, among other key announcements. The government said the initiatives are aimed at improving air quality, encouraging cleaner vehicles and strengthening the state’s economic growth.
Tax concessions for scrapping old vehicles
In his Budget speech, Fadnavis proposed concessions in motor vehicle tax for buyers who scrap old vehicles before purchasing new ones.
According to the proposal, individuals who scrap vehicles compliant with BS-4 and higher emission norms and buy new vehicles will receive a 16 per cent concession in motor vehicle tax. Those scrapping older vehicles that fall under BS-3 and below emission norms will be eligible for a 30 per cent concession while purchasing a new vehicle.
The chief minister said the move is intended to encourage owners to replace ageing vehicles that contribute significantly to pollution.
“These measures are aimed at discouraging the use of fuel-inefficient and polluting vehicles, improving air quality in the state and accelerating the replacement of older vehicles,” he said.
Environmental tax on older vehicles to double
Alongside incentives for scrapping vehicles, the government has also proposed to increase environmental taxes on certain private vehicles.
Fadnavis said non-transport (private) vehicles with BS-4 and older emission standards generate higher levels of pollution, and therefore the state plans to double the environmental tax on such vehicles.
The proposal is part of a broader strategy to curb emissions from ageing vehicles and encourage a shift towards newer, cleaner automobiles.
Cap on tax for crane-mounted vehicles
The government has also proposed a cap on taxes levied on crane-mounted vehicles.
Under the new proposal, motor vehicle tax on crane-mounted vehicles will be capped at a maximum of Rs 30 lakh, according to the chief minister.
The step is expected to provide relief to operators in the infrastructure and construction sectors who use heavy crane-mounted equipment.
Loan waiver for farmers announced
Apart from transport-related measures, the budget also introduced relief for farmers. Fadnavis announced a loan waiver scheme for crop loans up to Rs 2 lakh taken until September 30, 2025.
The scheme, named Punyashlok Ahilyadevi Holkar Shetkari Karjmafi Yojana, is expected to benefit a large number of farmers across Maharashtra.
In addition, farmers who have maintained regular repayment of their loans will receive an incentive of Rs 50,000, the chief minister said.
Ladki Bahin scheme to continue, rural connectivity focus
Fadnavis also confirmed that the Mukhyamantri Majhi Ladki Bahin Yojana, a welfare scheme aimed at supporting women, will continue and receive adequate financial allocation.
The government has also proposed improving rural connectivity by ensuring that all villages with a population of more than 1,000 are connected by concrete roads.
Highlighting Maharashtra’s economic ambitions, the chief minister said the state remains the financial engine of the country and aims to become a USD 5 trillion economy by 2047.
Emotional tribute to Ajit Pawar in assembly
During the budget presentation, Fadnavis paid tribute to former state finance minister Ajit Pawar, who passed away in an air crash earlier this year.
He announced that the government will establish a befitting memorial in honour of the late Nationalist Congress Party leader.
The assembly witnessed emotional scenes as members raised slogans of “Ajit Dada Amar Rahe” when Fadnavis stood up to present the budget, paying homage to the veteran leader.
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