Last week, we witnessed an increase in regulatory duty on 350 import items including mobile phones which created quite an uproar among the business community.
The government placed increased the regulatory duty on all vehicle categories by 15% but later Ministry of Commerce dropped another bomb in the shape of placing higher duties on the import of used cars over 1,800cc.
This new measure will decrease the import of used cars in Pakistan
Chairman of All Pakistan Motor Dealers Association HM Shahzad while talking to The Express Tribune said, “This (new regulatory duty) is going to badly hurt the business of used car importers, but the government will also lose up to Rs20-25 billion in revenue per year (due to lower volume).”
With the imposition of this new rule, the owners of all new and sued cars with engine capacity of more than 1800cc will have to pay duties themselves or by local recipients via bank encashment certificate.
The new regulatory duties were imposed by the federal government to decrease the growing imports in Pakistan and balance them with the country’s exports.
Pakistan has seen an import of around 65,000 used cars in the fiscal year of 2017
Due to the higher duties, this number may dwindle the import of used cars. Instead of seeing more revenues, the government may witness a decreased amount in its National kitty thanks to the new policy.