Finance Minister proposes tax hike on imported used cars

The federal government is contemplating a tax increase on the import of used cars in the upcoming budget for the fiscal year 2024-25. This potential move is expected to result in higher prices for imported vehicles. The proposal includes a 30% tax hike on imported used vehicles with an engine capacity of 1800cc or higher, raising it to 100% from the previous 70%. Furthermore, there is a plan to raise the duty tax by 15% on imported used vehicles with an engine size of up to 1800cc. However, new vehicles with an engine capacity of up to 1800cc or used hybrid vehicles may benefit from a zero percent duty tax.

Finance Minister Muhammad Aurangzeb is scheduled to present the budget in the National Assembly on June 10. The primary objective of the upcoming budget is to address various economic challenges while adhering to the stipulations outlined by the IMF. The government aims to alleviate the burden on the public amidst the escalating prices of goods and services.

The proposed tax adjustments on imported used cars in the upcoming budget could have significant implications for consumers and the automotive industry. As the government strives to navigate economic hurdles and fulfill international obligations, the impact of these tax changes on the affordability and availability of vehicles remains a critical aspect to monitor.