Token tax increased on cars

ISLAMABAD: The token tax on vehicles in Islamabad has been increased following approval from the National Assembly (NA) Standing Committee on Finance. Under the newly approved rates, the token tax on 1000 CC vehicles has been raised to Rs. 20,000, ARY News reported.

Briefing the committee, the Deputy Commissioner (DC) of Islamabad apprised members that the capital’s token tax had not been adjusted since 2019, whereas other provinces had already raised theirs.

Under the newly approved framework, vehicles up to 1000 CC manufactured before 2010 will now be subject to a fixed token tax of Rs. 20,000.

Furthermore, the tax structure for vehicles between 1000 CC and 1300 CC has been modified. Previously charged at 0.3% of the total invoice value, the rate has now been adjusted to 0.25% of the total invoice.

Under this updated formula, the token tax for these vehicle models manufactured before 2010 will amount to Rs. 2,500, while models manufactured after 2010 will be charged Rs. 6,200.

The DC informed the committee that the city had collected Rs. 3.9 billion from vehicle taxes in the current year, 19% of which was gathered digitally.

He added that following this tax hike, total collections are projected to rise from Rs. 3.9 billion to Rs. 5.2 billion in the upcoming fiscal year.