budgetOctober 2025Low impact
New Tax Incentive on Electric Vehicle Loans
Interest on loans taken to purchase electric vehicles may become eligible for a new deduction under Section 80EEB.
Affected taxpayers
EV buyers
To promote green mobility, the government is considering a deduction of up to ₹1.5 lakh on interest paid for electric vehicle loans under Section 80EEB, separate from the existing 80EEA for first‑time home buyers.
This would be over and above the ₹1.5 lakh 80C limit, giving additional tax savings to EV purchasers.
A final announcement is expected in the next Budget.