LAHORE: The cash-strapped government has retained the massive tax concessions on the manufacturing of hybrid electric vehicles (HEVs) despite concerns raised by the standard car manufacturing companies.

“After reading the Finance Bill 2023-24, we have reached a consensus that the PMLN-led coalition government has continued the PTI’s 2021 policy that gives 22pc tax concessions on manufacturing of HEVs — a Rs12 million car that can only be afforded by the rich and not the lower-middle or middle class,” a source in the auto industry told Dawn on Saturday.

He confirmed that the sales tax on 1,800cc and above HEVs was earlier 8.5pc and 12.75pc, respectively. Similarly, the customs duty on the import of some specific parts of HEVs was earlier 3pc and 4pc on two different technology HEVs — PHEV (Plug-in Hybrid Electric Vehicle) and HEV. “In the 2023-24 budget, there is no change in this, meaning that the 2021 policy has been extended for the next fiscal year as well.

According to another source in the industry, the government has added more parts to the list of localised parts under SRO 693 which essentially will increase the price of a standard car from Rs50,000 to Rs100,000. “The government has also rescinded fixed import duty on used cars above 1,300cc which means it would come on ad-valorem which is prone to under-invoicing. This move will encourage imports of used vehicles,” he maintained.

Published in Dawn, June 11th, 2023

Follow Dawn Business on Twitter, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Military option
Updated 21 Nov, 2024

Military option

While restoring peace is essential, addressing Balochistan’s socioeconomic deprivation is equally important.
HIV/AIDS disaster
21 Nov, 2024

HIV/AIDS disaster

A TORTUROUS sense of déjà vu is attached to the latest health fiasco at Multan’s Nishtar Hospital. The largest...
Dubious pardon
21 Nov, 2024

Dubious pardon

IT is disturbing how a crime as grave as custodial death has culminated in an out-of-court ‘settlement’. The...
Islamabad protest
Updated 20 Nov, 2024

Islamabad protest

As Nov 24 draws nearer, both the PTI and the Islamabad administration must remain wary and keep within the limits of reason and the law.
PIA uncertainty
20 Nov, 2024

PIA uncertainty

THE failed attempt to privatise the national flag carrier late last month has led to a fierce debate around the...
T20 disappointment
20 Nov, 2024

T20 disappointment

AFTER experiencing the historic high of the One-day International series triumph against Australia, Pakistan came...