Pakistan Approves Commercial Import of Five-Year-Old Used Cars with 40% Duty

The Tariff Policy Board (TPB), chaired by Minister for Commerce Jam Kamal Khan, has formally approved the commercial import of five-year-old used vehicles in Pakistan, subject to an additional 40% duty. This decision, finalized after two consecutive board meetings, is now headed to the Economic Coordination Committee (ECC) for final authorization.

Key Features of the Policy

• Scope of Imports: Applies to vehicles under PCT code 8703.
• Age Restriction: Cars up to five years old will be allowed until June 30, 2026; after that, the restriction will be removed.
• Additional Duty: A 40% Additional Regulatory Duty (ARD) will be imposed.
• Safety & Compliance: All imports must meet environmental and safety standards outlined by the Ministry of Industries and Production and other relevant authorities.

Industry Pushback

The move has drawn strong objections from Pakistan’s auto industry, which argues that the liberalization of used car imports could undermine domestic manufacturing. Industry stakeholders also caution that the used car trade has been flagged by the Financial Action Task Force (FATF) for potential links to money laundering and terror financing.

Local manufacturers, who describe the auto sector as one of Pakistan’s most vital engineering and industrial bases, say their recommendations—based on international practices—were largely ignored in the final proposal. With sales already declining and production costs rising, they warn that this decision could weaken the sector further.

Government’s Position

Despite opposition, the government appears committed to the plan, signaling alignment with IMF benchmarks while aiming to expand consumer choice in Pakistan’s automobile market. Supporters of the policy argue that allowing commercial imports will help stabilize vehicle prices and provide more options for buyers who are otherwise limited to costly locally produced models.

What Lies Ahead?

The ECC’s decision in the coming weeks will determine whether commercial importers gain access to a long-restricted market segment. If approved, the policy could spark a major shift in Pakistan’s automobile landscape, balancing IMF commitments, consumer demand, and the survival of local industry.

Disclaimer:
The information provided in this article is based on official announcements, industry reports, and credible sources available at the time of writing. Policies, duties, and regulations are subject to change following the final approval of the Economic Coordination Committee (ECC) and other government bodies. This content is intended for informational purposes only and should not be taken as financial, legal, or investment advice. Readers are encouraged to consult official notifications and industry experts before making any decisions related to vehicle imports or investments in the automobile sector.

Afsheen Gohar

Afsheen Gohar is a seasoned writer with a wealth of experience in crafting authentic and well-researched articles. Her dedication to delivering high-quality content is evident in her work, where she combines a passion for storytelling with a commitment to accuracy and depth. Afsheen’s writing reflects her ability to engage readers with compelling narratives while providing valuable insights on a diverse range of topics.