Good news is on the horizon for car buyers in Pakistan. The government is planning a major reduction in car prices as part of the upcoming 2025-26 federal budget. If you’re thinking about buying a vehicle, now might be the perfect time to wait and see what’s coming next.
Government Budget May Reduce Car Prices
The federal budget for 2025-26 is expected to be presented around June 2, though the final date depends on discussions with the International Monetary Fund (IMF). One of the most exciting updates? A potential reduction in taxes and duties on cars and auto parts. This could lead to significantly lower car prices across the country.
Customs Duties Likely to Drop by 20%
According to insider reports, there’s a proposal to reduce customs duties on vehicles by as much as 20%, with current duties ranging between 15% and 90%. If this proposal is approved, car prices in Pakistan could take a substantial dip—finally giving relief to consumers who have faced high costs for years.
Imported Cars to Benefit the Most
Popular imported models like Suzuki, Toyota Vitz, Daihatsu Mira, Toyota Prius, Honda Vezel, and Toyota Aqua are expected to benefit the most from these tax cuts. These vehicles have consistently remained favorites among Pakistani buyers, and the upcoming reductions could make them far more affordable.
Auto Parts and Raw Materials Also Targeted
It’s not just cars—the government is also looking to slash taxes on auto parts, industrial raw materials, and semi-finished goods. This includes vital sectors like textiles, chemicals, plastics, iron, and steel, potentially boosting manufacturing and lowering production costs industry-wide.
Plans for Extra Revenue Despite Tax Cuts
Even with the proposed tax reductions, the government plans to increase its tax target to Rs 14,305 billion. Through stronger enforcement and new revenue-generating measures, officials aim to recover around Rs 1,000 billion—ensuring a balanced approach.