Registration tax slashed for commercial vehicles in Islamabad

BusinessRegistration tax slashed for commercial vehicles in Islamabad

ISLAMABAD – In a relief for transporters and people linked with commercial vehicles, the federal government has lowered the registration tax for commercial vehicles in Islamabad.

Islamabad Capital Territory’s department of Excise and Taxation issued a press release announcing the reduction of taxes in another move to pass on relief to the distressed business community members facing unprecedented inflation.

   

As per the details shared by the capital authorities, the registration tax for commercial vehicles has been reduced from 4 per cent to 1 per cent.

The development comes as commercial vehicles such as truck and bus sales plunged amid an economic crisis. Reports suggesting data suggest that deals in the FY23 dropped to 1,947 units, down around 36 per cent year-on-year.

Meanwhile, officials continued to ease the automobile giants as. Lately, the customs duty has also been reduced from 30 per cent to 15 per cent on the assembly kits for 1000cc vehicles. On the other hand, the advance tax on cars with an engine capacity of 1600CC or above saw a hike in this fiscal year.

The custom duty for older vehicles, under the 1000cc engines category has also been slashed from 32.5 to 30 per cent; while the burden on tires and some other parts saw a drop of around 9 per cent.

Dark clouds over Pakistan’s auto industry

Besides a drop in sales of commercial vehicles, the sales of cars in total fell 38 per cent, Pakistan Automotive Manufacturers Association revealed, which occurred on the heels of curbs on the import of CKD units and issues related to letters of credit (LCs).

As the economic crisis worsened, the auto giants expected a further drop in sales of vehicles.

Despite the SBP and government orders, private banks in the cash-strapped country are not opening LCs for automotive companies, which augmented non-production days (NPDs), causing a shortage of assembly kits.

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