ISLAMABAD: The government has started considering reducing taxes on raw materials for locally manufactured vehicles in the upcoming budget.
It has been proposed to keep the national average tariff for locally manufactured vehicles below 6 percent.
According to sources, proposals have been made to promote the local auto industry in the new budget and new auto policy from July 1. It is proposed to extend the scope of the electric vehicle policy to all new energy vehicles.
It has also been proposed to include EVs, plug-in hybrids and fuel cell vehicles in the concessional tariff. Under the National Tariff Policy, it is proposed to eliminate additional customs duties and reduce regulatory duties. A proposal to give preferential protection to locally assembled EV vehicles over imported and fully manufactured vehicles is also being considered.
Sources say that it is proposed to keep the national average tariff for locally manufactured vehicles below 6 percent, and that the proposed concessional customs duty on CKD parts will remain in effect until June 30, 2028.
The government has also proposed to gradually shift auto sector incentives to the normal regime.
