In a move to promote electric vehicles (EVs) and improve air quality, the Telangana government has announced a significant incentive. All EVs purchased and registered in the state until December 31, 2026, will be completely exempt from road tax and registration fees.
This policy change, effective immediately, aims to accelerate EV adoption particularly in the passenger vehicle segment. Previously, the state had capped the number of eligible vehicles at 5,000. However, this limit has now been removed. With no cap on the number of EV registrations, the government aims to make Hyderabad a pollution-free city.
Road tax, registration fees waived off for EVs in Telengana
Hence, all EVs registered under the Telangana state transport department will be exempted from road tax and registration fees. This will bring down the price of an EV significantly. Therefore, on top of the ex-showroom price, a prospective EV buyer would only have to pay for insurance, road side assistance and accessories if opted.
As of now, Telangana has registered 1.7 lakh EVs, accounting for about 5% of all registered vehicles. The state government’s 2020-2030 Electric Vehicle and Energy Storage Policy was introduced during the previous regime under the KCR government which offered incentives, such as exemptions on road tax, registration fees, and retro-fitting costs on purchase of EVs but in a limited capacity.
That said, the updated EV policy will be extended beyond two wheelers and passenger vehicles and will be applicable to commercial vehicles such as taxis, three-wheelers, light goods carriers, tractors, and buses. Further, the Telangana State Road Transport Corporation (TSRTC) and private companies operating electric buses will enjoy a significant benefit. Both state-owned and private fleet electric vehicles will be entirely exempt from road tax and registration fees for their entire operational lifespan.
Will this boost EV sales?
On paper, this is a massive boost for EV manufacturers and prospective EV buyers both for private and commercial consumers. Although there are still question marks about implementation of this policy, if executed correctly this could usher a new wave of interest for EVs in Telangana boosting demand and sales. The number of EV registered in the Vahaan website from Telangana is bound to witness a significant spike in the coming months.
This development comes at a time when states like Karnataka, which already offers incentives to EV manufacturers but does not pass the benefits to consumers, are contemplating on updating or introducing policies that extend benefit directly to the consumers. This will also push other states to implement similar policies where benefits could be extended to both manufacturers and consumers which will boost EV sales across all segments.
