Pakistan Vehicle Import Duties: NA Committee Calls for Relief on Small Cars

On Monday, the National Assembly Standing Committee on Commerce held a detailed discussion on the controversial and inconsistent Pakistan vehicle import duties that continue to burden consumers, particularly those from middle-income groups who rely on small, fuel-efficient cars.

Small Cars Hit Harder Than Larger Vehicles

Committee member Shaista Pervaiz voiced serious concerns about the current duty structure, pointing out that small cars — which are typically more affordable and economical — have become increasingly expensive under the present import regime.

According to figures shared with the committee, small vehicles with engine capacities of up to 850cc attract a hefty 55 percent duty. By contrast, cars with engine sizes between 1300cc and 1800cc face higher rates at 65 percent and 75 percent, respectively. However, larger luxury vehicles continue to benefit from significant relief. Originally carrying a 200 percent regulatory duty, this was slashed by 90 percent under the latest tariff adjustments, now standing at just 50 percent.

This inverted duty structure, the committee argued, is making small, fuel-efficient cars less accessible while inadvertently favoring bigger, more expensive vehicles.

A Call for Affordable Mobility

Committee Chairman Javed Hanif stressed the need for urgent policy reform. He urged the government to address the affordability crisis faced by middle-income families in the upcoming auto policy. Lowering duties on small cars, he argued, would help boost sales in the domestic auto market while providing citizens with cost-effective, fuel-efficient transportation options.

Updates on Gold Jewelry Export Ban

The committee meeting also addressed Pakistan’s gold jewelry export sector. Members were informed that the ban on gold jewelry exports — imposed by the Federal Board of Revenue (FBR) in May via an SRO — will remain in effect until June 30. However, officials from the Ministry of Commerce confirmed that a summary has already been forwarded to the Prime Minister recommending that the ban be lifted to support the country’s struggling jewelry export industry.

Way Forward for Pakistan’s Auto Sector

The discussion on Pakistan vehicle import duties has once again highlighted the pressing need for a balanced and fair tariff structure that supports local buyers without encouraging the import of fuel-guzzling luxury cars at lower relative duties. Industry experts believe that rationalizing import duties for small cars can help the country reduce its fuel import bill, promote environmentally friendly vehicles, and provide relief to ordinary citizens.

As Pakistan prepares its next auto policy, all eyes will be on whether the government takes concrete steps to align vehicle duties with affordability and sustainability goals.

Afsheen Gohar

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