The federal government plans to raise about Rs. 188.58 billion through a new Automotive Development Levy on locally assembled or manufactured vehicles over a five-year span, according to revenue projections in the draft auto policy approved by Prime Minister Shehbaz Sharif.
ProPakistani reports the draft estimates show collections of Rs. 37.71 billion in 2026-27, increasing to Rs. 38.46 billion in 2027-28.
Projected receipts are Rs. 38.29 billion for 2028-29, Rs. 37.30 billion in 2029-30 and Rs. 36.83 billion in 2030-31.
The cumulative five-year total equals Rs. 188.58 billion.
The policy outlines varying levy rates based on vehicle type and engine size.
Cars under 1,000 cc would face a zero rate, those between 1,001 cc and 2,000 cc a 2 percent levy, and cars above 2,000 cc a proposed 10 percent rate.
These rates apply to both imported and locally assembled or manufactured internal combustion engine vehicles.
Two- and three-wheelers and agricultural tractors are exempt, while trucks, light commercial vehicles, buses, vans and certain prime movers would be charged a 2 percent levy.
The government expects revenue from the locally assembled or manufactured vehicle category to stay fairly steady, ranging from Rs. 36.83 billion to Rs. 38.46 billion each year.
The draft also includes separate estimates for levy collections on imported vehicles.
The ultimate revenue impact will hinge on how the policy is implemented, the calculation method used and the volume and mix of vehicles sold or imported during the five-year period.
