Gujarat Budget 2025-26 Highlights, Presented by Finance Minister Kanubhai Desai on February 20, 2025
On 20 Feb, Gujarat Finance Minister Kanubhai Desai unveiled the state’s budget for the fiscal year 2025-26, a substantial ₹3.70 lakh crore outlay focused on bolstering infrastructure development and promoting eco-friendly initiatives.
Notably, the budget introduces a significant reduction in motor vehicle tax for electric vehicles (EVs), signalling the state’s commitment to sustainable transportation.
Presenting the budget in the state assembly on Thursday, Desai, alongside Chief Minister Bhupendra Patel, announced a 5% rebate on the motor vehicle tax for fully battery-operated EVs. This move effectively slashes the tax rate from the current 6% to a mere 1%, offering substantial financial relief to EV buyers. The government estimates this tax relief, coupled with reduced stamp duty on mortgage deeds, will total ₹148 crore.
“This decision aligns with the Prime Minister’s vision of ‘Green Growth’,” Desai stated, emphasizing the government’s dedication to environmental conservation. The reduced tax burden aims to incentivize the adoption of EVs and contribute to a cleaner, greener Gujarat. Further bolstering the EV ecosystem, the budget allocates ₹50 crore for the development of EV charging infrastructure across the state.
The overall budget outlay of ₹3,70,250.35 crore represents an 11.36% increase (₹37,785 crore) compared to the FY25 budget. Desai projected a surplus of ₹1,007 crore for FY26, considering revenue, capital accounts, and the public account.
Beyond EVs, the budget also highlights Gujarat’s ambition to become a hub for Artificial Intelligence (AI). Desai announced the establishment of AI laboratories at LD Engineering College in Ahmedabad and six other government technical institutions. This initiative aims to equip Gujarat’s youth with the skills needed to thrive in the age of AI.
An existing AI taskforce, comprised of experts, will continue its work to integrate AI across various sectors. The state is also expanding its support for startups by extending the reach of i-Hub and i-Create incubators to all four regions of Gujarat.
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