Planning to buy a hybrid car in Delhi? New EV policy drops proposed tax exemption- What you should know

The Delhi government's Electric Vehicle Policy, that was approved by the Cabinet on Monday, 29 June, drops the proposed road tax and registration exemption for hybrid vehicles in the national capital. According to available data, the decision comes, despite a steady rise in sales of hybrid vehicles in Delhi.

The Delhi Cabinet, chaired by Chief Minister Rekha Gupta, approved the final version of the policy on Monday, leaving out an earlier proposal that would have granted buyers of strong hybrid vehicles a 50 per cent exemption on road tax and registration charges.

What changes for hybrid car buyers under the Delhi EV Policy?

The draft version of the Delhi EV Policy had proposed a 50 per cent exemption on road tax and registration fees for strong hybrid cars priced up to ₹30 lakh. However, the provision does not feature in the final policy approved by the Cabinet.

Instead, the Delhi government has opted to focus its incentives on vehicles that produce zero tailpipe emissions, as part of its objective of accelerating the adoption of fully electric vehicles as part of Delhi's broader efforts to combat air pollution.

For prospective hybrid car buyers, this means purchases will continue to attract the applicable road tax and registration charges, unlike battery-powered electric vehicles that remain eligible for policy benefits.

What are hybrid vehicles and how do they work?

Hybrid vehicles combine a conventional internal combustion engine, powered by petrol or diesel, with one or more electric motors that draw energy from an onboard battery.

By switching between these power sources or using them simultaneously, hybrid cars improve fuel efficiency while reducing exhaust emissions compared with conventional petrol or diesel vehicles.

Unlike fully electric vehicles, hybrid electric vehicles (HEVs) do not require external charging. Instead, they replenish their batteries through regenerative braking, a system that captures energy normally lost during braking and converts it into electricity. The stored energy is then used to power the electric motor, reducing fuel consumption during everyday driving.

As fuel prices remain elevated, hybrid vehicles have gained popularity among consumers seeking better mileage without concerns over charging infrastructure. Although they typically cost more than comparable petrol or diesel models, the higher upfront price can often be offset by lower fuel consumption over time. In several states, tax concessions and other incentives have also helped reduce ownership costs, though Delhi's new policy will not extend such benefits.

Hybrid vehicle sales continue to rise in Delhi

The exclusion of hybrid vehicles from the incentive framework comes despite growing consumer interest in the segment.

According to official data cited by PTI, fossil fuel-based hybrid vehicles accounted for 1.7 per cent of all vehicle registrations in Delhi this year, while electric hybrids represented another 1.2 per cent.

Data available on the Vahan portal shows that 4,410 hybrid four-wheelers were registered between January and May this year, up from 3,456 during the corresponding period last year, representing growth of around 27 per cent.

The longer-term trend also points to increasing adoption. Hybrid vehicle sales stood at 961 units during the January-May period in 2024. In 2025, total hybrid sales reached 7,767 units, compared with 4,982 in 2024, registering a year-on-year increase of approximately 56 per cent.