Maharashtra Chief Minister Devendra Fadnavis presented the state’s annual Budget for 2026–27 on Friday in the state Assembly, introducing several tax reforms aimed at increasing revenue and promoting environmental sustainability. Among the key measures, the Budget proposes higher environmental taxes on older vehicles and incentives for vehicle scrappage.

The government plans to increase the environmental tax on non-transport (private) vehicles that comply with BS-IV and lower emission standards. Under the new proposal, the tax on two-wheelers will rise from Rs 2,000 to Rs 4,000, light motor vehicles running on petrol will see a hike from Rs 3,000 to Rs 6,000, and light diesel vehicles from Rs 3,500 to Rs 7,000. Additionally, a cap has been proposed on motor vehicle tax for crane-mounted vehicles, limiting it to a maximum of Rs 30 lakh.

To encourage the replacement of older vehicles, the Budget includes concessions for vehicle owners opting for scrappage. Owners scrapping BS-IV and higher vehicles and purchasing new ones will receive a 16 per cent concession on motor vehicle tax, while those scrapping BS-III and lower vehicles will be eligible for a 30 per cent concession.

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The Budget also seeks to strengthen compliance under the Maharashtra Stamp Act. Penal provisions under Sections 59, 60, 63A, and 68A, which cover execution of instruments with insufficient stamp duty, will see an increase in fines from Rs 5,000 to up to Rs 1 lakh. The move is aimed at curbing underpayment of stamp duty and enhancing state revenue.

For the financial year 2026–27, the state’s own tax revenue is projected at Rs 4,15,653 crore, up from Rs 4,09,593 crore in revised estimates for 2025–26. Total revenue receipts are estimated at Rs 6,16,099 crore, with total expenditure projected at Rs 7,69,467 crore, resulting in a revenue deficit of Rs 40,552 crore. The Budget allocates Rs 23,150 crore for the Scheduled Caste Sub Plan and Rs 21,723 crore for the Tribal Sub Plan.

Fadnavis emphasized that the Budget is built on principles of progressiveness, sustainability, comprehensiveness, and good governance. The state has consistently maintained a fiscal deficit below 3 per cent of Gross State Domestic Product and a revenue deficit under 1 per cent, aligning with the Fiscal Responsibility and Budget Management Act. The fiscal deficit for 2026–27 is projected at Rs 1,50,491 crore, reflecting continued fiscal discipline alongside expanded welfare and capital spending.

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