Pakistan is set to see a significant drop in car prices as the government moves to reduce import tariffs, following an agreement with the International Monetary Fund (IMF).
Under the plan, tariffs on the automobile sector will be slashed by one-third over the next five years, opening the market to foreign competition.
Sources reveal that the government has committed to eliminating additional customs and regulatory duties on imported vehicles while lowering the weighted average tariff to 5.6%.
This will make imported cars more affordable and increase competition in the local market, which has long been dominated by a few manufacturers with high prices.
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Currently, the highest import duty on cars in Pakistan reaches up to 196% of the vehicle price, making them significantly more expensive than in other countries.
The new tariff policy aims to bring these rates down, aligning them with the broader trade liberalization strategy under the IMF agreement.
The policy changes will take effect in the 2025-26 fiscal year, with full implementation expected by 2030. Authorities believe that lower tariffs will not only make cars more accessible to consumers but also boost economic activity by increasing overall trade.
With this move, Pakistan aims to create a more competitive automobile market, providing consumers with better options at lower prices while encouraging the growth of the auto industry.
