The government has approved changes to the taxation system through the Finance Bill 2026, affecting vehicle owners across Pakistan from July 1.
As per details, the previous flat token tax rates based solely on engine capacity have been replaced with a percentage-based model linked to a vehicle’s invoice value.
According to the approved token tax rates, vehicles with engine capacities of up to 1,000cc will continue to pay a flat annual tax of Rs20,000.
For vehicles ranging from 1,001cc to 2,000cc, owners will be required to pay token tax equivalent to 0.25 per cent of the vehicle’s invoice value.
Meanwhile, vehicles with engine capacities between 2,001cc and 2,500cc will give a token tax of 0.35 per cent of the invoice value. The same 0.35 per cent rate will also apply to all vehicles with engine capacities above 2,500cc.
The revised taxation system will come into effect from July 1, 2026, and is expected to have a greater impact on owners of high-value vehicles.
In a separate development, Lucky Motors earlier reduced the prices of several Kia and Peugeot vehicles in Pakistan by Rs1 million to Rs1.3 million, according to reports on Monday.
Kia Pakistan also shared an official announcement on Instagram about the changed price of the Sportage L Alpha.
In its message to customers, the company thanked buyers for their support. It also said that the offer is available for a limited time.
Eligibility
The company said that all the customer orders invoiced on or after June 22, 2026, will be eligible for the new ex factory price.
It also said that any new government taxes, duties or charges introduced before delivery will have to be paid by customers. The ex-factory prices do not include freight and insurance charges.
The revised price will apply to both cash buyers and customers who are purchasing the vehicle through EMI plans.
According to the company announcements that were shared by PakWheels, the prices of Peugeot 2008 variants have been lowered by Rs1.2 million to Rs1.3 million.
The Peugeot 2008 Active now costs Rs5.799 million, and the Peugeot 2008 Allure is now priced at Rs6.499 million.
The company has also reduced the price of the Kia Sportage L Alpha by Rs1 million. The vehicle’s old price was Rs8.899 million, and its new price is Rs7.899 million.
Lucky Motors assembles Kia and Peugeot vehicles locally in Pakistan. The company has also recently partnered with Chinese automaker GAC to introduce electric vehicles in the country.
Kia Pakistan announces limited-time offers
Kia Pakistan recently announced a limited time offer with which the buyer can get a 20 per cent discount on extended warranty packages for select vehicle models.
This offer is from June 15 to June 30, 2026, and covers the Kia Picanto, Kia Stonic, Kia Sportage QL and Kia Sorento UM.
The basic extended warranty for the Kia Picanto has been reduced from Rs25,000 to Rs20,000, while the standard extended warranty package now costs Rs24,000 instead of Rs30,000.
