Islamabad (National Times) The federal government has proposed the imposition of new taxes on imported and high-end vehicles in the Budget 2026-27.
Finance Minister Muhammad Aurangzeb announced during his budget speech in the National Assembly that Federal Excise Duty (FED) will be imposed on imported vehicles. The proposal also includes the introduction of FED on SUVs with engine capacities between 2,000cc and 3,000cc.
According to budget documents, an increase in Federal Excise Duty has also been proposed for vehicles with engine capacities above 3,000cc. In addition, luxury electric vehicles valued at over Rs. 20 million will also be brought under the FED regime.
However, the government has maintained existing tax exemptions for electric motorcycles, rickshaws, and buses. A concessional 1 percent sales tax has also been proposed for imported electric trucks.
The government stated that these measures aim to broaden the tax base and promote a balanced policy framework for the automotive sector.