Tax Relief on Old Car Imports Proposed in Budget Plan Sent to IMF

ISLAMABAD: The federal government has proposed significant tax relief on old car imports as part of its budget recommendations submitted to the International Monetary Fund (IMF), according to Dunya News.

According to insider reports, the upcoming budget includes a proposal to allow the import of vehicles up to five years old. Alongside this move, the government is also considering a phased elimination of additional customs duties and recommending reductions in regulatory duties.

Reforms have been suggested in the Fifth Schedule of the Customs Act, which involve lowering tariff rates on older vehicles by 10 percent annually. Moreover, the plan calls for avoiding the imposition of any new regulatory duties on the auto sector.

The proposed tax relief on old car imports also includes ending non-tariff barriers in the automotive sector and gradually reducing the average tariff on auto-related imports to below 6 percent by 2030.

These steps aim to liberalize vehicle imports and make used cars more affordable for the Pakistani market, while aligning with IMF expectations for structural reforms.

It is worth noting that the federal budget for the next fiscal year is scheduled to be presented in the National Assembly today, with approximately Rs2 trillion in new taxes expected to be announced.