The government has withdrawn the cap of fixed duties and taxes on the import of old and used vehicles of ‘Asian Makes’ above 1,300 CC under SRO 577(I)/2005 by omitting serial number 4,5 and 6 of the said SRO.

An industry official said the move will push higher the prices of imported used cars with engine size between 1,300cc and 1,800cc.

Previously, there was a cap on imported used cars up to engine size 1,800cc.

“This move will give power to the customs officers,” H.M. Shahzad, Chairman of All Pakistan Motor Dealers Association (APMDA), told Business Recorder after the budget announcement.

“These powers were curtailed when duties were fixed in 2005.”

Previously, there was a fixed duty between $5,500 and $23,000 for engine sizes between 660cc and 1,800cc vehicles.

Shahzad said that cars of engine sizes of up to 1800cc should not be considered as luxury.

He further said that price of imported used cars such as Honda Freed, Grace, Vezel, Toyota Prius, Aqua and Yaris would go up.

Meanwhile, the government has also proposed to reduce customs duty from 10% to 5% on non-localized (CKD) of Heavy Commercial Vehicles (HCVs).

Meanwhile, the government will allow import of CBU units of Hybrid Electric Vehicles (HEV) at 1% under Auto Industry Development and Export Policy (AIDEP).

The concession will be admissible to manufacturers on import of the same variant to be assembled locally subject to certification and quota determination by the Engineering Development Board (EDB).

Import of HEV parts has also been allowed at 4% for hybrid electric vehicles subject to certification and quota determination by the EDB.

Meanwhile, for plug-in hybrid cars, parts import is allowed at 3% with similar conditions.