Under the new measures, imported vehicles with engine capacities between 2,000cc and 3,000cc will be subject to an 86% duty, while vehicles above 3,000cc will face a 92% duty. Duties on imported vehicles have been reduced in several categories, with rates on 1,800cc vehicles cut from 156% to 74%, vehicles above 1,500cc from 91% to 57%, vehicles between 1,000cc and 1,500cc from 76% to 52%, and 850cc vehicles from 66% to 42%.
The budget also exempts vehicles up to 1,800cc from special excise duty under the new auto policy. Imported electric vehicles valued up to $75,000 will face a 30% customs duty, while EVs worth more than $110,000 will be taxed at 40%.
A concessional sales tax of 10% has been imposed on children’s pencils, pens and sharpeners.
From July 1, a one-time fixed tax of Rs10,000 will apply to vehicles up to 1,000cc in federal areas, while token tax on pre-2010 vehicles of the same category will be Rs20,000. Vehicles between 1,001cc and 1,300cc will be charged a token tax equivalent to 0.3% of the invoice value, while the federal token tax rate has been fixed at 0.25% of the total invoice value.
The Finance Bill also introduces tougher penalties for non-compliance with FBR notices. A first violation will carry a Rs1 million fine, while repeated violations may result in penalties of up to Rs2 million.
Failure to install the electronic tax monitoring system from July 1 could lead to legal action, with disrupting the system punishable by up to five years in prison. Factories, industrial units and shops damaging or tampering with the monitoring system will also face fines and penalties.
The FBR will offer rebates of up to Rs30 million to businesses installing the electronic system. Detailed procedures regarding installation and compliance will be published on the FBR website on July 1.
The budget further makes electronic filing of income tax returns mandatory through the Iris portal. Companies will also be required to submit financial statements in machine-readable formats. Taxpayers opting for the new algorithmic settlement mechanism will be allowed to file revised returns without prior approval from a commissioner and without additional penalties or surcharges.
Speaking in the National Assembly, Prime Minister Shehbaz Sharif said Pakistan had played a key role in facilitating recent diplomatic efforts between the United States and Iran. He expressed hope that ongoing technical discussions between the two countries would lead to lasting peace and welcomed the visit of Iranian President Masoud Pezeshkian to Pakistan.
The prime minister also said Pakistan’s development could not be measured by the progress of a single province and stressed that all four provinces must advance together for the country’s overall growth.
