CEO Ali Asghar Jamali Proposes Tax Measures

Indus Motor Company's CEO, Ali Asghar Jamali, has been actively engaging with government officials to propose measures aimed at strengthening the local auto industry. The focus is on raising taxes on imported used cars to create a more favorable environment for domestic car manufacturers.

In recent discussions with key government figures, such as the Federal Minister for Finance and the chairman of the Federal Board of Revenue, plans were put forth for the upcoming budget. The goal is to implement higher duties and taxes on used cars to safeguard the local auto sector, especially in light of a more stable economic climate and potential interest rate reductions.

Jamali underscored the challenges faced by the local auto industry, noting that the surge in demand for locally produced cars, expected to begin in January 2024, has been impeded by the influx of imported used vehicles. While there was a modest 28% increase in local car sales, the import of used cars witnessed a staggering 711% rise in February compared to the previous year. This trend poses a significant threat to the industry's vendors, potentially leading to closures if not addressed promptly.

The local auto industry, which has invested approximately $2.5 billion and contributed around Rs400 billion in taxes during FY2022, plays a crucial role in the economy by generating 2.5 million employment opportunities. Jamali also highlighted the success of the Toyota Corolla Cross, a newly launched hybrid electric vehicle with a commendable localization rate exceeding 50% in its components.

If the proposed measures are put into effect, it is projected that the Federal Board of Revenue could witness a revenue increase of Rs80 billion. This would not only bolster the financial health of the government but also support the growth and sustainability of the local auto industry, ensuring its continued contribution to the national economy.