Pakistan’s government has introduced big changes in vehicle import taxes in the Budget 2026-27. From July 1, imported cars and SUVs with engines between 2000cc and 3000cc will face a high 86% duty. Vehicles above 3001cc will face even higher taxes at 92%. These steps mainly target luxury and large-engine imported vehicles.
This move aims to increase government revenue and encourage local manufacturing. Many luxury cars, like big SUVs will become much more expensive for buyers. Analysts say this will discourage unnecessary imports of high-end vehicles and help reduce pressure on foreign currency reserves.
On the positive side, the government has reduced duties on smaller and more affordable cars. For example, duties on 1800cc vehicles drop sharply from 156% to 74%. Cars above 1500cc will see duties fall from 91% to 57%, while 1000-1500cc vehicles go from 76% to 52%. Even small cars up to 850cc will enjoy lower duties, from 66% to 42%. This should make everyday cars cheaper for middle-class buyers.
For electric vehicles (EVs), the bill proposes 30% duty on EVs up to $75,000 and 40% on those above $110,000 (or higher value slabs around Rs 2-3 crore). Fixed token taxes based on engine size and model year will also apply.
The new rules will take effect from July 1, 2026.
