The government of Pakistan has made a significant decision that will bring relief to the manufacturers of Heavy Commercial Vehicles (HCVs). In the recently announced fiscal budget for 2023-24, the government has taken a step to support the local manufacturing industry by reducing the Customs Duty (CD) on completely knocked down (CKD) buses and trucks from 10% to 5%. This move is expected to have an impact on the prices of buses and trucks, and it is likely to be a welcome development for both manufacturers and consumers.
The reduction in CD on CKD buses and trucks is a strategic decision by the government to incentivize the local production of these vehicles. By lowering the import duty, the government aims to encourage domestic manufacturing, which will not only create employment opportunities but also boost the economy. While manufacturers may choose not to increase the prices of buses and trucks, the reduced CD will provide them with some breathing space and enable them to maintain the current prices for a certain period. This news comes as a relief for owners of goods and people transporter services who heavily rely on these vehicles for their operations.
Customs Duty On Tractors in Budget 2023-24
In addition to the relief provided to the HCV sector, the government has also imposed a Customs Duty of 15% on the import of agricultural tractors. The CD for tractors is determined based on their engine power, and the details available indicate that tractors with an engine power between 26 kW and 75 kW will be subject to a 15% CD, while other agricultural tractors will have a CD of 10%.
The decision to impose CD on agricultural tractors reflects the government’s efforts to strike a balance between promoting local manufacturing and managing import dependencies. By setting different CD rates based on engine power, the government aims to incentivize the production of tractors within the country. This move is expected to encourage the local manufacturing industry and enhance self-sufficiency in agricultural machinery.
While the imposition of CD on agricultural tractors may lead to a slight increase in their prices, it is a measure aimed at supporting domestic production and reducing import reliance. The government’s focus on the agriculture sector and its commitment to improving the overall productivity and efficiency of the industry are evident in this decision. It is a step towards ensuring the availability of reliable and affordable agricultural machinery for farmers across the country.
