Budget 2024-25: New tax rates on vehicles in Pakistan

New tax rate introduced in the budget 2024-25 on locally manufactured vehicles among many others, comes into effect today (July 1).

This change marks a shift from a fixed tax rate to a value-based tax system, as outlined in the Finance Bill 2024-25.

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Under the new tax regime introduced in budget 2024-25, the tax on vehicles is no longer a fixed amount but varies according to the vehicle’s value.

1. For vehicles up to 850cc, the tax rate is now 0.5%, replacing the previous fixed tax of Rs10,000.
2. Vehicles ranging from 851 to 1000cc will be taxed at 1%, instead of the former fixed tax of Rs20,000.
3. Vehicles between 1001 and 1300cc will be charged 1.5% tax rate against the previous Rs25,000 fixed tax.
4. Vehicles from 1301 to 1600cc will be taxed at 2%, instead of the previous fixed tax of Rs50,000.
5. For vehicles ranging from 1601 to 1800cc, the tax rate is now 3%, up from the previous fixed tax of Rs150,000.
6. Vehicles between 1801 and 2000cc will face a 5% tax rate against earlier fixed tax of Rs200,000.
7. For vehicles from 2001 to 2500cc, the tax rate has been increased from 1% to 7 per cent.
8. Vehicles in the 2501 to 3000cc range will now be taxed at 9%, up from the previous 1% increase.

The new tax rates have been enforced across Pakistan from today (July 1).