Budget 2023-24: Pakistan plans to hike prices of cars

ISLAMABAD – The federal government is mulling imposition of withholding tax (WHT) on locally manufactured vehicles on the basis of invoice price instead of engine capacity in the upcoming budget for fiscal year 2023-24.

Federal Finance Minister is expected to unveil the budget for next fiscal year on June 9 amid economic crisis that has triggered inflation in the country.

Meanwhile, the Pakistan Automotive Manufacturers Association (PAMA) has warned the government against its move of imposing WHT on the basis of invoice price.

In a letter to the Chairman Federal Board of Revenue (FBR), PAMA highlighted that changing the basis of WHT will hurt the sales of locally-made vehicles as it will lead to increase in retail prices.

PAMA has also asked the government to reduce the current engine-based WHT on vehicles. It informed that the auto sector has been struggling since restrictions on import imposed by the government due to shortage of dollars.