Delhi EV Policy: BMW Calls for State EV Policies to Align With Centre, Flags Risk of Tax Arbitrage

BMW Group India has called for greater alignment between state and central electric vehicle (EV) policies, after Delhi's new EV Policy restricted road tax and registration fee exemptions to electric cars priced below ₹30 lakh, a move that has drawn criticism from luxury carmakers despite their support for the broader objective of accelerating electric mobility. BMW cautioned that varying state-level incentives could distort buying behaviour and encourage customers to register vehicles in neighbouring states offering more favourable tax regimes. 

According to BMW Group India President and CEO Hardeep Singh Brar, customers have historically shifted registrations to states offering lower taxes and similar trends could emerge again if policy differences widen. “Last year when there was policy in Haryana, a lot of people shifted from Haryana to Delhi. With people now shifting, there's extra taxes on EVs in Delhi, then I think maybe there could be a shift to UP as well. But I think largely over a period of time, people adjust to this and they try to see where they're getting lower registration,” Brar said. 

He said state governments should ensure their policies complement, rather than contradict, the Centre's approach to EV adoption.

“I would say the state policies should be in line with the central government policies. I think the central government is keeping 5 percent GST consistent all across states. I would suggest that state policy should follow the central policies and not the other way around,” he said. 

BMW is strengthening its leadership in India's luxury EV market. The company sold 2,359 electric vehicles in the first half of 2026, up 78% year-on-year, with EVs accounting for 26% of its total sales. BMW said it now commands a 69% share of the luxury EV segment, making it the country's largest luxury EV brand.

Brar believes several factors are accelerating the shift towards electric mobility, including uncertainty around fuel prices, improving charging infrastructure and tighter regulations governing conventional powertrains.

“I think there are a couple of factors why the EV narrative is getting attention. One point is because if there is so much noise going on in social media, it will naturally push customers towards the safest option because EV is phenomenal and away from all the noise which is going around. And also the recent fuel prices increase because of the West Asia crisis has also kind of created uncertainty in consumers' mind that which way the fuel prices are going to go,” he said. 

With luxury EV sales gaining momentum, the company said policy consistency across states would provide consumers with greater certainty and help sustain the transition to electric mobility.