The federal government of Pakistan is planning to cut the sales tax on imported and locally assembled hybrid electric vehicles from 25% to 18%. This step aims to make these eco-friendly cars more affordable for ordinary people.
A summary of the proposal has already been sent to the Finance Division. It needs final approval from the federal cabinet before it becomes law. The change comes after the earlier lower tax rates ended on June 30, 2026. From July 1, the tax jumped to 25%, which made hybrid cars more expensive and slowed down sales.
Hybrid vehicles use both petrol and electric power. They use less fuel, produce fewer harmful emissions, and help reduce air pollution in big cities like Karachi and Lahore. Pakistan faces serious environmental challenges, including rising fuel costs and climate change. Lower taxes on hybrids can encourage more people to buy them instead of regular petrol cars.
Experts believe this reduction will lower vehicle prices, boost demand, and support local car makers such as those assembling Toyota, Haval, and Hyundai hybrids. It will also help Pakistan move towards cleaner transport and meet its green goals.
The auto industry has grown quickly with hybrids in recent years. This tax relief is expected to create jobs, increase investment, and make sustainable travel easier for middle-class families. If approved, the new rate could take effect soon and bring positive changes to Pakistan’s roads and environment.
