Pakistan’s federal government has announced a new tax on the registration of vehicles above 2000cc in the budget 2023-24. The tax will be based on the value of the vehicles and will vary according to their engine capacity. The tax will replace the previous fixed tax that was imposed on these vehicles.
According to the finance bill amendment, a 6 percent tax will be imposed on the value of cars that have an engine capacity of 2001cc to 2500cc. Previously, these cars had to pay Rs150,000 tax if they were registered by filers and Rs300,000 if they were registered by non-filers.
Similarly, an 8 percent tax will be charged on the value of cars that have an engine capacity of 2501cc to 3000cc. Before, these cars had to pay Rs200,000 tax if they were registered by filers and Rs400,000 if they were registered by non-filers.
On cars that have an engine capacity above 3000cc, a 10 percent tax will be applied to their value. In the past, these cars had to pay Rs250,000 tax if they were registered by filers and Rs450,000 if they were registered by non-filers.
The new tax is expected to generate more revenue for the government and discourage the import and use of big cars that consume more fuel and emit more pollution. The government has also increased the customs duty on the import of luxury cars and jeeps in the budget 2023-24.
The budget 2023-24 has a total outlay of Rs8.48 trillion and aims to achieve a growth rate of 4.8 percent in the next fiscal year. The budget has also proposed various relief measures for the common people, such as a reduction in sales tax on essential items, an increase in the minimum wage, and expansion of social safety net programs.
