EV Manufacturers Warn of Setback as Sales Tax Rises to 18%

Pakistan’s electric bike manufacturers have expressed serious concern over the government’s decision to raise sales tax from 1% to 18%, warning that the move could stall the country’s transition toward clean and affordable mobility. The industry says the steep hike risks derailing Pakistan’s emerging electric vehicle (EV) revolution by increasing costs for both producers and consumers.

During a meeting with Special Assistant to the Prime Minister on Industries and Production Haroon Akhtar Khan, EV makers and representatives from Pak Star Automobiles urged the government to reverse the tax increase and protect the growing EV sector. Khan assured stakeholders that the government would revisit policy hurdles and continue to support sustainable industrial growth.

Khan reaffirmed that the government’s focus remains on local manufacturing and job creation under the second phase of the EV policy.

“The EV policy is not just about industry  it’s about a cleaner Pakistan and long-term economic strength,” he said, emphasizing the Prime Minister’s vision for sustainable development.

He also directed the Engineering Development Board (EDB) to collaborate with EV manufacturers to identify bottlenecks and suggest practical solutions to accelerate growth. The government, he added, remains committed to enabling local players, cutting petroleum imports, and expanding Pakistan’s EV ecosystem through incentives and reform.