Search

Auto industry recommends increased taxes on used car Imports for 2024-25 budget

02:27 PM | 25 May, 2024
Prices of cars

Pakistan’s auto industry has recommended that the government increase the duties and taxes on the import of used cars in the federal budget for the upcoming fiscal year 2024-25. Additionally, they propose a complete ban on car purchases by non-filers.

The auto industry has also urged the government to implement a transparent mechanism for the import of used cars by overseas Pakistanis, ensuring these vehicles are imported solely for family use.

In discussions with media following meetings with officials from the Federal Board of Revenue (FBR), the Ministry of Commerce, and the Ministry of Finance regarding budget proposals, Ali Asghar Jamali, CEO of Indus Motors Company, stated that automobile and parts manufacturers have submitted their suggestions for the next fiscal year’s federal budget. He noted that incorporating these proposals could generate an additional 60 to 70 billion rupees in tax revenue from the automobile sector.

Jamali emphasized that the local auto industry has requested higher duties and taxes on used car imports in the upcoming budget. This measure aims to ensure that any initial economic improvements from anticipated stable exchange rates and lower interest rates benefit the local auto industry.

Vehicle sales in February 2024 showed a 28% increase, rising from 3,642 units in February 2023 to 7,953 units. However, there was a staggering 711% increase in used car imports during the same period, which poses a significant challenge for the local auto industry.

The Chairman of the Pakistan Auto Parts Manufacturers Association (PAPAM) highlighted that the local auto industry has invested $2.5 billion and contributed 400 billion rupees in revenue to the national treasury in the fiscal year 2022. Despite this, the average monthly import of used cars from July 2023 to April 2024 was 3,068 units, severely impacting the local industry.

Jamali stressed the need for a transparent mechanism for importing used cars, ensuring that overseas Pakistanis can import vehicles only for their family's use.

He added that large-scale imports of used cars have harmed the country’s foreign exchange reserves and, combined with the depreciation of the rupee and economic uncertainties, have threatened future investments.

Toyota’s newly introduced hybrid electric vehicle, the Toyota Corolla Cross, performed well in the first quarter, with over 50% of its parts being locally sourced. Additionally, around 13 brands collectively produce more than 40 models locally, with a combined annual production capacity of 500,000 units. However, the import of used cars is posing significant challenges to the survival of the local auto industry.

Jamali appealed to the government to rationalize import taxes on used cars to revive the local market, protect the interests of local manufacturers, and ensure the sustainability of numerous jobs.

Advertisement

Pakistani Rupee exchange rate to US Dollar, Euro, Pound, Dirham, and Riyal - 19 June 2024

Pakistani rupee rates against US Dollar and other currencies on June 19, 2024 (Wednesday) in open market.

USD to PKR Rate Today

US dollar was being quoted at 277.50 for buying and 280.65 for selling.

Euro's buying rate stands at 296 and selling rate is 299 while British Pound rate is 349.7 for buying, and 353.25 for selling.

UAE Dirham AED was at 74.80 and Saudi Riyal at 72.80.

Forex Rates 

Currency Symbol Buying Selling
US Dollar USD 277.50 280.65
Euro EUR 296.00 299.00
UK Pound Sterling GBP 349.70 353.25
U.A.E Dirham AED 74.80 75.60
Saudi Riyal SAR 72.80 73.55
Australian Dollar AUD 182.00 184.00
Bahrain Dinar BHD 741.18 749.18
Canadian Dollar CAD 204.00 206.00
China Yuan CNY 38.43 38.83
Danish Krone DKK 40.18 40.58
Hong Kong Dollar HKD 35.66 36.01
Indian Rupee INR 3.33 3.44
Japanese Yen JPY 1.90 1.98
Kuwaiti Dinar KWD 909.34 909.34
Malaysian Ringgit MYR 59.30 59.90
New Zealand Dollar NZD 170.79 172.79
Norwegians Krone NOK 25.97 26.27
Omani Riyal OMR 723.88 731.88
Qatari Riyal QAR 76.42 77.12
Singapore Dollar SGD 203.65 205.65
Swedish Korona SEK 26.40 26.70
Swiss Franc CHF 311.90 314.40
Thai Bhat THB 7.58 7.73

Advertisement

Follow us on Facebook

Follow us on Twitter

Sign up for Newsletter