A Guide to Vehicle Taxes in Pakistan

The number of vehicles on roads is increasing year on year as auto-financing through banks has made owning a vehicle easier. The data shows that auto-financing in Pakistan had reached 353.64 billion PKR in November of 2021. Data shared by the All Pakistan Automotive Manufacturers Association (APAMA) shows that vehicle sales have grown 96 percent in December 2021 when compared to December 2020. Therefore, Graana.com, Pakistan’s smartest property portal, takes a look at the tax on cars in Pakistan.

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Taxes Applicable on Vehicles in Pakistan

 

A silhouette of a car with tax stamped on it to show tax on cars

 

The following are some of the taxes charged on private and commercial vehicles in Pakistan:

  1. Income Tax
  2. Token Tax
  3. Withholding Tax
  4. Motor Tax
  5. Professional Tax

 

Income Tax on Cars in Pakistan

When you own a vehicle, you must pay a set percentage of your income tax. In Pakistan, the rate of income tax on vehicle registration varies, depending on whether you file or not.

 

Engine Capacity Filers (PKR) Non-Filers (PKR)
Below 1000cc 10,000 20,000
1000-1199 cc 1,500 3,000
1200-1299 cc 1,750 3,500
1300 cc 2,500 5,000
1301-1499 cc 2,500 5,000
1500 cc 3,750 7,500
1501-1599 cc 3,750 7,500
1600-1999 cc 4,500 9,000
2000 cc 10,000 20,000
2001-2500 cc 10,000 20,000
Above 2500 cc 10,000 20,000

 

Token Tax on Cars in Pakistan

A particular amount of tax must be paid annually for the issuing of a token that legally certifies a vehicle to be on the road. Let’s take a look at the current token tax rates in Pakistan, as per the 2019-20 budget.

 

Engine Capacity Tax
Motorcycle 1,500
Below 1000cc 1,500
1000-1199 cc 1,800
1200-1299 cc 1,800
1300 cc 1,800
1301-1499 cc 6,000
1500 cc 6,000
1501-1599 cc 9,000
1600-1999 cc 9,000
2000 cc 9,000
2001-2500 cc 12,000
Above 2500 cc 15,000

 

Withholding Tax on Cars in Pakistan

Let’s have a look at the current rates of withholding tax in Pakistan on automobile registration (for filers and non-filers).

 

Engine Capacity Filer Non-Filer
Below 850 cc 7,500 15,000
851-1000 cc 15,000 30,000
1001-1300 cc 25,000 50,000
1301-1600 cc 50,000 100,000
1601-1800 cc 75,000 150,000
1801-2000 cc 100,000 200,000
2001-2500 cc 150,000 300,000
2501-3000 cc 200,000 400,000
Above 3000 cc 250,000 450,000

 

Motor Tax on Cars in Pakistan

The motor tax is one of the most important type of car tax in Pakistan. It may vary between private and commercial cars. The table below contains information on the current motor tax rates in Pakistan.

 

Motor Tax for Commercial Vehicles

 

Tax on cars in pakistan

 

Details of motor tax charged from commercial vehicles in Pakistan are given below:

 

Loading Capacity Tax
Upto 4060 kg 1,000
4060-8120 kg 2,200
8120-12000 kg 4,000
12000-16000 kg 6,000
Above 16000 kg 8,000

 

Motor Tax for Private Vehicles

 

A queue of private vehicles

 

details of motor tax charged from private vehicles in Pakistan are given below:

 

Type of Vehicle Tax
Hatchback, Sedan, SUV 2,500
Bus, Station Wagon 300

 

Professional Tax on Cars in Pakistan

The professional tax rate remains the same for all of the vehicles indicated above.

Professional Tax Rate: PKR 200

 

Federal Budget 2022-23

 

Calculator placed on balance sheets with budget written on top

 

Non-filers are subject to a 200 percent advance tax on the purchase of autos with engine displacements greater than 1600cc.

This decision is expected to have an impact on the demand for a variety of vehicles in Pakistan. Customers will have to pay the following advance tax for locally produced ‘luxury cars’:

 

New Rates for Advance Tax in Federal Budget 2022-23
Vehicle Engine Capacity (cc) Previous Tax New Tax
Corolla Altis Below 1,800 150,000 300,000
Hyundai Elantra Below 2,000 200,000 400,000
Hyundai Tucson Below 2,000 200,000 400,000
Hyundai Sonata Below 2,000 200,000 400,000
DFSK Glory Below 1,800 150,000 300,000
Kia Sportage Below 2,000 200,000 400,000
BAIC BJ40 Above 2,000 200,000 400,000
Hyundai Sonata 2.5 Below 2,500 300,000 600,000
Kia Sorento Below 2,400 300,000 600,000
Toyota Fortuner 2,700-2,800 400,000 800,000
Toyota Hilux Below 2,800 400,000 800,000
Isuzu D-Max 3,000 400,000 800,000
Kia Sorento V6 Below 3,500 450,000 900,000

 

Although this tax will have no direct effect on the price tags, it will raise the entire cost of owning these vehicles. It will also help the government collect more taxes from people belonging to the higher socio-economic class and bring them into the tax net.

The government intends to maintain the auto sector’s existing progress while also urging the industry to completely indigenize car and component production. Get to know Popular driving schools in Islamabad

For more information on taxes in Pakistan, visit our blog.


Read More:
Calculate and Pay Vehicle Token Tax Online in Punjab

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