Approval to impose heavy duty on imported hybrid electric and luxury vehicles

The National Assembly’s Standing Committee on Finance has approved proposals to impose 30 to 40 percent customs duty and 86 to 92 percent special excise duty on imported hybrid, electric and luxury vehicles.

The meeting was chaired by Committee Chairman Syed Naveed Qamar, in which important issues including auto policy, tax on mobile phones and import duties were discussed in detail.

Minister of State for Finance Bilal Azhar Kayani said that the current auto policy is ending on June 30. The Commerce Secretary informed the committee that a reduction in duties has been proposed on vehicles of different engines to reduce the burden.

Regarding electric vehicles, FBR officials said that federal excise duty will not be imposed on electric vehicles worth up to $75,000, while tax will be levied on vehicles worth more than Rs20 million.

The committee also approved a proposal to extend the one percent sales tax concession on imported parts of electric vehicles for one year.

In the meeting, Sharmila Farooqui and Hina Rabbani Khar raised questions on the policy of electric vehicles and said that how will vehicles be promoted when charging stations are not available.

The committee also approved proposals to impose 30 to 40 percent customs duty on the import of large electric vehicles. The government is of the view that large vehicles will not be made cheaper.

The meeting considered the auto policy and taxes in detail and approved the relevant proposals.