The government has announced new tax measures under the imported vehicles tax Pakistan policy, introducing Federal Excise Duty (FED) on imported cars and luxury automobiles as part of the federal budget 2026-27.
Finance Minister Muhammad Aurangzeb, while presenting the budget in the National Assembly, confirmed that FED will now be applied to imported vehicles, including SUVs and high-end electric cars.
He stated that vehicles in the 2,000cc to 3,000cc category will also fall under the new Federal Excise Duty structure, marking a significant shift in automotive taxation policy.
According to the budget announcement, the government has also decided to increase FED on vehicles above 3,000cc, while luxury electric vehicles priced above Rs20 million will also be taxed.
Officials said the move under the imported vehicles tax Pakistan framework aims to broaden the tax base and regulate high-end vehicle imports in the country.
At the same time, the government clarified that incentives for electric motorcycles, rickshaws, and buses will remain unchanged to support affordable green transport.
A reduced sales tax rate of 1 percent has also been proposed for imported electric trucks, as part of efforts to promote cleaner logistics solutions.
The finance minister also announced that Federal Excise Duty on business class international air travel has been abolished, balancing taxation measures with selective reliefs.
