ISLAMABAD: According to the details, the government is set to increase prices of locally built or assembled vehicles with an engine capacity of up to 850cc from July 1, 2025.
According to the sources, the government has decided to increase the rate of sales tax from 12.5 percent to 15-18 percent in the upcoming budget 2025-2026.
Currently, a reduced rate of 12.5 percent sales tax is being charged on locally assembled or made motorcars of cylinder capacity up to 850cc.
Under the Finance Bill 2025-26, the Federal Board of Revenue (FBR) will eliminate entry number 72 of the Eighth Schedule of the Sales Tax Act 1990 to discontinue the concessionary sales tax regime for the locally assembled or produced motorcars.
