Price Impact on Cars after The Increase of RD Tax
Price Impact on Cars after The Increase of regulatory Duty
Government lifts import ban on cars, although
Previously, the finance minister said that the government chose to relax the prohibition in response to the international Demand by (IMF). However, it should be noted that regulatory taxes will be three times higher on non-essential imported goods, therefore regulatory duties were hiked above.
Earlier, Miftah Ismael, the finance minister, stated: “We will levy such severe charges that these commodities cannot be imported [easily] or at least in their finished condition. Cotton, edible oil, and wheat will be my top priorities because We don’t have enough revenue. I don’t put automobiles or iPhones first.
Ismail claimed that because we lacked the foreign currency to buy premium car models instead of food and other important necessities of life, 400–600% of regulatory taxes will be levied.
Later on, the import prohibition on luxury and non-essential products was lifted by the Pakistani government with a signifying massive hike in regulatory duty. And two days ago, we saw exactly what had been predicted Miftah Ismail, the federal minister of finance, reported that regulatory duty on imported autos (CBU) was subjected to a significant hike of 85%.
Regulatory Duty (RD) to 100%
The Federal Board of Revenue (FBR) has increased the regulatory taxes (RD) and additional customs duties (ACD) on the import of luxury and non-essential products, including automobiles (CBU).
According to reports, the previously 15% regulatory taxes on vehicles with a displacement of more than 1000cc have been doubled to 100%. This means that taxes levied on CBU autos increased by 85%. As a result, car costs would reach a new high; the local market would see a new round of price increases.
According to SRO1571(I)/2022 from the Federal Board of Revenue, the increased rate of regulatory duty will be in effect from August 22, 2022, through February 20, 2023.
The government has started taking the required actions in an effort to manage import costs and prevent fiscal slippages. The Federal Board of Revenue (FBR) has increased the regulatory duties (RD) and extra custom taxes (ACD) on the import of luxury and non-essential goods, including automobiles (CBU).
Miftah Ismail said:
“Even so, a person can import a vehicle that originally costs Rs. 60 million but will cost them Rs. 300–400 million [after the regulatory duties].” Added by him.
Other Customary Duties
The following PCT codes are subject to an additional 35 percentage customs charge levied by the FBR on vehicles:
Sport utility vehicles, sometimes known as SUVs, 4by4 vehicles
Sedans and hatchbacks (2329)
2490 — automobiles with diesel engines
SUV CKD or SKD kits, 3223
All-terrain vehicles (4×4), category 3225
3229 — HTV (heavy transport vehicles) also known as commercial vehicles
3390 — Other internal combustion or electric-powered vehicles
SRO.1517(I)/2022 was a vehicle in 9000.
The import ban on luxury and non-essential goods, including imported cars, was lifted earlier, according to the finance minister Miftah Ismail, who made the announcement during a news conference.
According to speculations, the previously 15% regulatory taxes on vehicles with a displacement of more than 1000cc have been doubled to 100%. This means that taxes levied on CBU autos increased by 85%. As a result, car costs would reach a new high; the local market would see a new round of price increases.
As per SRO1571(I)/2022 from the Federal Board of Revenue, the increased rate of regulatory duty will be in effect from August 22, 2022, through February 20, 2023.
what will be the effect on car prices as regulatory duty (RD) increases, and how will this affect the market?
Regulatory Duty (RD) Increase
According to speculations, the earlier 15% regulatory taxes on vehicles with a displacement of more than 1000cc have been doubled to 100%. This means that taxes levied on CBU autos increased by 85%. As a result, car costs would reach a new peak; the local market would see a new round of price increases.
According to SRO1571(I)/2022 from the Federal Board of Revenue, the increased rate of regulatory duty will be in place from August 22, 2022, through February 20, 2023, but can affect the prices of vehicles in the local market before February 2023.
These automobiles, which are among the most well-known imported ones in the nation, would be compromised by the latest regulatory tariff increase.
Honda vehicles
Honda CR-V 2.0 CVT
Is Currently Priced at PKR: 10,700,000.
Accord 1.5L VTEC Turbo
Is Currently Priced at PKR: 15,499,000
MG vehicles
HS 1.5T
Is Currently Priced at PKR: 8.9 million
HS PHEV
Is Currently Priced at PKR: 8.5 million
ZS 1.5
Is Currently Priced at PKR: 4.4 Million
ZS EV Luxury
Is Currently Priced at PKR: 6.25 Million
Toyota vehicles
Corolla Cross Low Grade
Is Currently Priced at PKR: 12.25 Million
Corolla Cross Premium High Grade
Is Currently Priced at PKR: 13.42 Million
Corolla Cross Smart High Grade
Is Currently Priced at PKR: 13.01 Million
Prius S
Is Currently Priced at PKR: 14.65 million
Rush G Manual
Is Currently Priced at PKR: 8.33 million
Rush G Automatic
Is Currently Priced at PKR: 8.01 Million
Toyota Camry high Grade
Is Currently Priced at PKR:23.32 Million
Suzuki vehicles
Jimny
Is Currently Priced at PKR: 6.05 Million
APV
Is Currently Priced at PKR: 6.29 million
Hyundai Vehicles
IONIQ GLS
Is Currently Priced at PKR: 7 Million
Staria 3.5 Automatic
Is Currently Priced at PKR: 7.2 Million
Staria 2.2D Manual
Is Currently Priced at PKR: 7.75 Million
Staria 2.2D Automatic
Is Currently Priced at PKR: 7.35 million
Staria HGS
Is Currently Priced at PKR: 9.3 Million
Santa Fe GLS
Is Currently Priced at PKR: 18.5 million
KIA Vehicles
Carnival GLS
Is Currently Priced at PKR: 10.2 Million
Carnival GLS+
Is Currently Priced at PKR: 12,599,000
Carnival Executive
Is Currently Priced at PKR: 12,600,000
recently the Prices of the cars decreased due to rupee appreciation against us dollar what do you think will local cars prices will decrease or increase cause still dollar is 9% down but prices of some cars are still the same .
What do you think about this please let us know in the comment section below.
caution: all Prices are the estimated EX factory prices