The government is taking necessary steps to tackle the prevailing economic fuss. Depleting foreign reserves and financial issues urged the government to put a ban on importing non-essential luxury items.
Three months after the car ban was imposed, the government reversed the decision in the face of some international requirements. A week ago, the current government ended the import ban and imposed a record regulatory duty on imported cars.
The Federal Board of Revenue (FBR) increased the regulatory duties (RD) on cars larger than 1000cc to 100 percent, which had previously been 15 percent. Meaning, duties imposed on CBU cars observed a hike of 85 percent.
The Federal Board of Revenue had issued SRO1571(I)/2022, under which the increased rate of regulatory duty was applicable from August 22, 2022, to February 2023.
Concerning electric vehicles, the official notification has stated that the hike observed in the regulatory duty imposed on electric vehicles “shall take effect on and from the 22nd day of August, 2022 till the 21st day of November, 2022.” Means, the recent duty hike is applied for only three months, unlike the petrol cars which is for February 2023.
Unless the fresh duty hike is reversed, the market will witness a price hike and a reasonable drop in imported, more importantly, electric cars.
The given validity will end in a few months, and most probably the government will extend the date. If not, the government will revise the SRO for the new RD figures.
Additional Custom Duties
The FBR has also imposed 35 percent additional custom duty on the vehicles falling under the following PCT codes:
- 2323 — Sport utility vehicles -SUVs 4×4
- 2329 — Sedans and Hatchbacks)
- 2490 — diesel-powered vehicles
- 3223 — CKD or SKD kits for SUVs
- 3225 — all-terrain vehicles (4×4)
- 3229 — Commercial vehicles
- 3390 — Other vehicles with internal combustion engines or electric motor
- 9000 — Vehicle included SRO.1517(I)/2022.
What do you think about the recent increase in regulatory duty? Drop your thoughts in the comments section.