Bengaluru: Karnataka govt’s decision to levy tax on electric cars has sparked concern, with stakeholders warning it could slow down EV adoption rate in the state. They argue that incentives remain critical as the technology is still evolving and adoption in the state trails conventional vehicles by several miles.The numbers underline the gap. In Bengaluru, EVs account for just 4.1 lakh of over 1.2 crore vehicles as of Feb 2026. Two-wheelers dominate with 3.2 lakh units, while electric cars number 37,365. In Feb alone, 9,250 EVs were registered — nearly 6,900 two-wheelers and 991 cars — reflecting the pace of adoption.Transport minister Ramalinga Reddy defended the move, saying the proposed lifetime tax across price categories aims to boost revenue. “The state expects to generate Rs 259 crore. The measure is intended to mobilise additional funds,” he said.Confusion, however, persists. Social media posts have flagged provisions in the Bill that refer to tax slabs based on vehicle age, triggering fears of retrospective taxation. A senior transport official clarified that such slabs apply only when vehicles registered in other states are re-registered in Karnataka after obtaining an NOC, and not to existing EV owners in the state.A dealer said they have been informing customers with pending bookings that road tax will now apply to electric cars. “Earlier, there was a complete exemption for EVs priced up to Rs 25 lakh. Going forward, buyers will have to factor in the additional cost,” the dealer said.He added that no official communication has yet been received from regional transport offices on the date from which the proposed tax — if approved — will be implemented.On electric mobility Pawan Mulukutla, executive director of World Resources Institute India, said: “Internal combustion engine vehicles (which usually run on petrol or diesel) are a major contributor to urban emissions. In a city like Bengaluru, with its high-vehicle density, accelerating the transition to electric mobility is critical. Any policy intervention that reduces the cost competitiveness of electric vehicles could undermine this shift. Karnataka was among the early adopters of a dedicated electric mobility policy, and it is important to ensure subsequent measures do not inadvertently slow down EV adoption. If taxes are extended across all EV segments, it risks making them less attractive compared to petrol and diesel counterparts, potentially delaying the transition to cleaner mobility.”
