ISLAMABAD: In a move to shield local car manufacturers, the government has announced strict new measures on imported vehicles. A key decision is a 40% additional tax on commercially imported used cars, set to begin next month. There will also be a complete ban on importing accident-damaged or substandard vehicles.
A senior commerce ministry official stated these actions are part of an agreement with the International Monetary Fund (IMF). The IMF deal requires Pakistan to eventually open up its market to older imported cars but allows for this high tax as temporary protection for local companies.
This policy has sparked a debate. On one side, local automakers strongly oppose the IMF deal, arguing that it will make imported used cars more attractive than locally made ones. They admit that local vehicles are expensive and suffer from quality issues, but they blame high government taxes for the steep prices.
On the other side, the IMF is pushing for more competition and choice for consumers. However, industry representatives warned that manufacturing cars in Pakistan is expensive and difficult, making imports an easier profit. Despite the upcoming allowance for more imports, analysts say these new taxes mean consumers should not expect a significant drop in vehicle prices anytime soon.
Also read:Used car prices expected to drop significantly in upcoming budget
