The government has passed noticeable amendments to the vehicle tax structure through the Finance Bill 2026-27. These changes officially updated the import duties across various car categories in Pakistan. Consequently, the latest duty structure creates a massive divide in the automotive market.
Buyers will see a decrease in the prices of small and mid-level cars. However, premium cars will experience a major price increase, regardless of whether they are traditional combustion engines, hybrids, or EVs.
Here is a complete, simplified breakdown of the new import taxes. Furthermore, this guide directly compares the 2026 duty rates against the 2025 figures so you can understand the exact differences.
Relief for Standard Imported Cars in Finance Bill 2026-27
First, the government provided major tax relief for smaller imported vehicles. Cars with engine capacities up to 1800cc significantly benefit from reduced Customs Duty (CD). Specifically, the 1501cc to 1800cc segments received the largest Customs Duty cuts.
Therefore, compact and mid-size imported cars may become much more affordable this year.
| Engine Capacity | Duty Type | 2025 | 2026 | Difference |
|---|---|---|---|---|
| Up to 800cc | Customs Duty | 50% | 30% | -20% |
| Federal Excise Duty | 2.5% | 2.5% | 0% | |
| 801cc–1000cc | Customs Duty | 55% | 35% | -20% |
| Federal Excise Duty | 2.5% | 2.5% | 0% | |
| 1001cc–1300cc | Customs Duty | 60% | 40% | -20% |
| Federal Excise Duty | 5% | 5% | 0% | |
| 1301cc–1500cc | Customs Duty | 60% | 40% | -20% |
| Regulatory Duty | 10% | 8% | -2% | |
| Additional Customs Duty | 6% | 4% | -2% | |
| Federal Excise Duty | 10% | 10% | 0% | |
| 1501cc–1600cc | Customs Duty | 75% | 45% | -30% |
| Regulatory Duty | 10% | 10% | 0% | |
| Additional Customs Duty | 6% | 4% | -2% | |
| Federal Excise Duty | 10% | 10% | 0% | |
| 1601cc–1800cc | Customs Duty | 75% | 45% | -30% |
| Regulatory Duty | 10% | 10% | 0% | |
| Additional Customs Duty | 6% | 4% | -2% | |
| Federal Excise Duty | 10% | 10% | 0% |
Premium & Luxury Cars Face Massive Hikes
On the other hand, luxury vehicles face an entirely different reality. The government indeed reduced Customs and Regulatory Duties for vehicles above 2000cc. However, the Finance Bill introduced a massive new Special Excise Duty.
Consequently, this new tax aggressively increases the overall financial burden on luxury imports.
| Engine Capacity | Duty Type | 2025 | 2026 | Difference |
|---|---|---|---|---|
| 2001cc–3000cc | Customs Duty | 100% | 50% | -50% |
| Regulatory Duty | 50% | 20% | -30% | |
| Additional Customs Duty | 6% | 4% | -2% | |
| Federal Excise Duty | 30% | 30% | 0% | |
| Special Excise Duty | 0% | 86% | +86% | |
| Above 3000cc | Customs Duty | 100% | 50% | -50% |
| Regulatory Duty | 50% | 20% | -30% | |
| Additional Customs Duty | 6% | 4% | -2% | |
| Federal Excise Duty | 40% | 40% | 0% | |
| Special Excise Duty | 0% | 92% | +92% |
Taxes on Hybrids & Electric Vehicles (EVs)
Similarly, high-capacity hybrid vehicles did not escape the new tax structure. Hybrids between 1800cc and 2000cc benefit from lower Customs Duty with minimal changes elsewhere. Conversely, hybrids over 2000cc now carry the exact same aggressive Special Excise Duty penalty as standard combustion engines.
| Vehicle Type | Duty Type | 2025 | 2026 | Difference |
|---|---|---|---|---|
| Hybrid (1800cc–2000cc) | Customs Duty | 100% | 50% | -50% |
| Regulatory Duty | 10% | 10% | 0% | |
| Additional Customs Duty | 6% | 4% | -2% | |
| Federal Excise Duty | 30% | 30% | 0% | |
| Hybrid (2001cc–3000cc) | Customs Duty | 100% | 50% | -50% |
| Regulatory Duty | 10% | 10% | 0% | |
| Additional Customs Duty | 6% | 4% | -2% | |
| Federal Excise Duty | 30% | 30% | 0% | |
| Special Excise Duty | 0% | 86% | +86% |
Additionally, the Finance Bill completely overhauled the tax structure for imported Electric Vehicles (EVs). Previously, EVs fell under two simple value slabs. Now, the government applies a three-tier value-based duty system. Expensive EV models face steep Federal Excise Duty jumps.
Here is the exact structural shift from 2025 to 2026:
2025 EV Duty Structure
| Vehicle Value | Customs Duty (CD) | Additional Customs Duty (ACD) | Federal Excise Duty (FED) |
|---|---|---|---|
| Below $50,000 | 25% | 0% | 0% |
| Above $50,000 | 50% | 6% | 0% |
2026 EV Duty Structure
| Vehicle Value | Customs Duty (CD) | Additional Customs Duty (ACD) | Federal Excise Duty (FED) |
|---|---|---|---|
| Up to $75,000 | 25% | 0% | 0% |
| $75,001–$110,000 | 30% | 4% | 30% |
| Above $110,000 | 30% | 4% | 40% |
Overall Impact of Finance Bill 2026-27 on ICE Vehicles & Double Cabins
Ultimately, buyers need to see the net difference in total taxation. The table below aggregates the total taxes and duties across the different Internal Combustion Engine (ICE) vehicle categories, including the heavy penalties slapped on double-cabin pickups.
| Category | Total 2025 | Total 2026 | Net Difference |
|---|---|---|---|
| 1301–1500cc | 171% | 137% | -34% |
| 1501–1600cc | 194% | 144% | -50% |
| 1601–1800cc | 194% | 144% | -50% |
| 1801–2000cc | 370% | 219% | -151% |
| 2001–3000cc | 370% | 430% | +60% |
| Above 3000cc | 406% | 470% | +64% |
| Double Cabin Pickup (Up to 3000cc) | 182% | 307% | +125% |
| Double Cabin Pickup (Above 3000cc) | 182% | 318% | +136% |
Disclaimer: The figures provided are simplified and summarized. Please refer to official government documents for complete and error-free details.
