Starting next month, the government will enforce a 40% import duty on commercial imports of used cars. Alongside this, vehicles that have previously been in accidents will no longer be allowed for import.
ISLAMABAD:
A government official said on Monday that the import of accidental cars will be banned, and a 40% new tax will be imposed at the time of opening commercial imports of used cars next month to protect the local industry, delaying any benefits to the consumers from trade liberalisation.
During a joint session of the Senate Standing Committees on Finance and Industry, Joint Secretary for Trade Policy, Mohammad Ashfaq, clarified that the government would no longer permit the import of low-quality or accident-damaged vehicles. He explained that, in line with an understanding with the International Monetary Fund (IMF), an additional 40% tariff protection compared to new vehicles would be introduced from the current fiscal year.
Ashfaq also mentioned that the government has yet to finalize its decision on whether the special car import schemes will continue or be discontinued once restrictions on commercial imports are lifted.
Currently, commercial imports of cars are banned, and most used vehicles enter the country through special schemes such as transfer of residence, baggage, and gift. These imports account for nearly one-fourth of the local market demand, as many buyers still prefer slightly damaged imported cars over locally manufactured options.