Draft Auto Policy 2026-31 Would Change Vehicle Sales Tax
Battery EVs would stay at 1%, while some petrol cars could fall from 25% to 18%.
Pakistan's proposed Auto Policy 2026-31 could change sales tax rates across electric, hybrid, and petrol-powered vehicles.
The figures below are from the draft. The update says they are not implemented tax rates.
The sales tax rates in the draft
Under the draft:
- Battery electric vehicles would remain at 1%.
- Range-extended EVs would rise to 6%.
- Plug-in hybrids would drop to 9%.
- Petrol cars between 1,400cc and 2,000cc could see sales tax reduced from 25% to 18%.
- Other categories would retain their existing rates.
These changes are proposals, not implemented tax rates, and remain subject to further approvals.
Our verdict
The draft would leave battery EVs at 1% sales tax, lift range-extended EVs to 6%, cut plug-in hybrids to 9%, and could cut sales tax on 1,400cc to 2,000cc petrol cars from 25% to 18%. None of that applies until further approvals.
Follow for more updates.
Frequently asked questions
Are these sales tax rates in force?
No. They are proposals and remain subject to further approvals.
What would battery electric vehicles pay?
1%, which is unchanged in the draft.
What about range-extended EVs and plug-in hybrids?
Range-extended EVs would rise to 6%. Plug-in hybrids would drop to 9%.
What happens to petrol cars?
Cars between 1,400cc and 2,000cc could fall from 25% to 18%. Other categories would keep their existing rates.
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