The federal government has reduced import taxes on completely built-up (CBU) vehicles as part of its fiscal year 2026-27 reforms, a move expected to lower the prices of thousands of imported cars in Pakistan.
Under the new tariff structure, the government has slashed the Regulatory Duty (RD) and Additional Customs Duty (ACD) on imported vehicles, reducing the overall tax burden on cars imported from Japan, China, Thailand, Europe, the United States and the Middle East.
According to official notifications (SROs), the Regulatory Duty on vehicles previously taxed at 50% has been reduced to 20%, while the 10% RD has been cut to 8%. The government has also lowered various slabs of Additional Customs Duty, making imported vehicles more affordable for buyers.
Pakistan imports thousands of vehicles every year through commercial imports and personal baggage schemes. Popular imported models include Toyota Land Cruiser, Prado, Corolla, Yaris, Noah, Voxy and Alphard, Lexus SUVs, Honda Vezel, Civic, CR-V and Fit, Suzuki Jimny, Hustler and Japanese Wagon R, Nissan Note, X-Trail and Serena, as well as vehicles from Mazda, Mitsubishi, Subaru, BMW, Mercedes-Benz, Audi, Volvo, Porsche, Range Rover, Kia, Hyundai and electric vehicle brands such as BYD, MG and Tesla.
Government data shows that the number of imported vehicles varies annually depending on import policies, foreign exchange availability and government restrictions. However, thousands of vehicles continue to enter the country each year through commercial and personal import schemes.
Auto industry experts say the impact of the duty cuts will differ depending on engine size and applicable tax category. They estimate that imported vehicles valued at around Rs3 million could become Rs100,000 to Rs300,000 cheaper, while cars worth Rs5 million may see price reductions ranging from Rs300,000 to Rs600,000.
For SUVs priced around Rs10 million, buyers could save between Rs1 million and Rs2 million, while luxury vehicles valued between Rs15 million and Rs20 million may become Rs2 million to Rs5 million cheaper. High-end models such as the Toyota Land Cruiser and Range Rover could see total savings exceeding Rs5 million, although the final reduction will depend on the vehicle’s CIF value, engine capacity and other applicable taxes.
Market estimates suggest imported Toyota Vezel models could become Rs500,000 to Rs800,000 cheaper, while Honda Vezel Hybrid prices may fall by Rs600,000 to Rs1 million. The Toyota Prado could see a reduction of Rs2.5 million to Rs4 million, while the Land Cruiser LC300 may become Rs5 million to Rs10 million cheaper.
Luxury brands are also expected to benefit. The Lexus LX600 and Range Rover could witness price cuts ranging from Rs6 million to Rs15 million, while Mercedes-Benz GLE, BMW X5 and Audi Q7 models may become Rs2 million to Rs3.5 million cheaper. Porsche Cayenne models could see reductions of up to Rs6 million.
Electric vehicles are also expected to become more affordable, with the BYD Atto 3 likely to see prices drop by Rs400,000 to Rs800,000, while imported MG models could become Rs500,000 to Rs1.2 million cheaper.
The government’s decision is expected to provide the biggest relief for buyers of imported vehicles from brands including Toyota, Honda, Nissan, Lexus, Suzuki, BMW, Mercedes-Benz, Audi, Porsche, Range Rover, BYD, MG and Tesla, particularly for fully imported CBU models.
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