The 46-year-old Bollywood star took to Twitter to express his gratitude.
"Thanks to UP Govt and @yadavakhilesh for making @DrishyamTheFilm tax free. One more reason for you all to watch the film," Devgn wrote.
In the past UP government has made films like "Masaan", "Bajrangi Bhaijaan", "Tevar" and "Hamari Adhuri Kahani" tax-free in the state.
Directed by Nishikant Kamat, "Drishyam" is a thriller drama featuring Devgn, Tabu and Shriya Saran in lead roles.
The film is a remake of 2013 Malayalam film of the same name, which starred Mohanlal and Meena.