Monday, December 11, 2023

Government thinks about additional car taxes next week

ISLAMABAD: The government is considering passing a tax amendment ordinance on cars next week, it was learned on Friday.

Sources said the Federal Board of Revenue (FBR) suggested withdrawing 3% of the additional sales tax on electric vehicle imports while granting one percent tax exemption for locally made electric cars.

Similarly, the ordinance proposes an exemption of one percent from the additional customs tax on spare parts for electric vehicles.

According to the law, an additional tax of Rs0.2 million will be charged when purchasing new vehicles.

However, the sources said that legislation was required to collect the withholding tax. In addition, the federal office has already given the go-ahead to charge additional
vehicle taxes.

The sources also disclosed that new taxes would be applied if a person sold his new car within three months of purchase.

How much additional taxes on car:

Additional withholding tax of Rs50,000 would be charged on cars up to 1,000 cc.

The sources also added: “Additional tax of Rs0.1 million would be charged on cars between 1,000 and 2,000 cc. Likewise, a withholding tax of an additional Rs0.2 million would be charged on cars over 2,000 cc.

The additional withholding taxes will remain in effect until 30 June 2021.

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