Prime Minister (PM) Shehbaz Sharif has approved the new auto policy 2026–31 on Wednesday.
According to the details, the new auto policy will now be shared with the International Monetary Fund (IMF). After the IMF’s approval, the auto policy will be presented to the Economic Coordination Committee (ECC).
After cabinet approval, the new auto policy will be presented to the parliament. A meeting was held under the chairmanship of PM Shehbaz Sharif on the draft of the new auto policy 2026-31.
What is the new auto policy 2026-2031?
The purpose of the new auto policy is to provide a conducive environment for investment in the local auto industry, vehicle exports, local production and promotion of modern technology.
The new auto policy proposes a 20 per cent reduction in tax on the import of hybrid vehicles in the next 5 years.
It is also proposed to reduce the duty on hybrid vehicles from 851 to 1000 cc and up to 800 cc from 50 per cent to 30 per cent in the next 5 years.
Under the policy draft, a phased reduction in tax has been proposed over the next 5 years on the import of hybrid vehicles above 1800 cc.
It is proposed to reduce the duty on hybrid vehicles above 1801 cc from 50 per cent to 30 per cent in a phased manner over 5 years.
Additionally, a proposal to reduce the duty on hybrid vehicles from 1501 to 1800 cc from 50 per cent to 30 per cent is also under consideration.
According to the details, a proposal to reduce the duty on hybrid trucks from 30 per cent to 15 per cent is also included.
What will the duty be on hybrid vehicles?
The duty on hybrid commercial vehicles is to be reduced from 60 per cent to 30 per cent.
The preparations are also underway, according to the reports, to reduce the duty on hybrid buses from 30 per cent to 15 per cent.
According to sources, approval will also be sought from the IMF before the announcement of the new auto policy.
The implementation of the policy will begin after the approval of the ECC and the federal cabinet.
According to sources, it has been proposed to impose a 10 per cent environmental levy on vehicles from 2001 to 3000 cc. A 19.5 per cent environmental levy has been proposed for vehicles from 3001 cc and above.
It is estimated that a total revenue of Rs 142.79 billion will be generated from the proposed environmental levy over a period of five years.
