Government plans to impose wealth tax on vehicles

Government plans to levy wealth tax on moveable assets as well as increase customs duty on up to 5,200 tariff lines.

Let’s just face it buying a new car is not cheap. Especially in Pakistan where the unreasonable taxes make it a huge achievement in one’s life to afford a brand new car. But since our new government, is exploring various ways to generate more revenue, and it seems to follow the footpath of the previous Government, which also imposed 2 percent additional customs duty to raise revenue collection.

Specifically, the Government will eventually reduce the import period on vehicles from 3 years to 2 years and in the case of Jeeps, the import period is being reduced from 5 years to 3 years.

Not only that, but the sources say that things like mobiles phones, cigarettes and hundreds of other items might also fall victim too and go upwards in price.

Read More: Import of cars increased by 6% in Financial year 2018

The maximum customs duty as of now is 20% and the increase will take it up to 23%. This will help in raising sales tax collection at the import stage. Sure the additional customs duty of 2 to 3 percent would contribute to higher inflation, but for the Government, it means Rs40 billion additional taxes in revenue.

Brilliant as he is, however, our new finance minister failed to devise a new effective policy to collect additional taxes from the nation so, hence the possibility of further raising the tax on moveable assets. Since Pakistan is in huge debt, thanks to previous governments, the possibility of taxes and prices going down anytime soon is highly unlikely.

The new government somehow has to collect the taxes in order to run the country, which comes in the form of additional luxury taxes on vehicles as if they were already cheap or even reasonable by any means. Probably not the change we want but let’s see what the future holds.

Awais Yousaf

I'm a crazy car guy. I want an aeroplane hangar full of cars. Is that too much to ask for?

Notable Replies

  1. Hamaray current Finance Minister b Ex-Finance Minister k Naqsh E Qadam p chall niklay hain' :smirk:

    Taxes Kamm ya Zyada Kar daina kabhi b masail ka hall nai hota! You need to have long term, consistent policies, which are, unfortunately, not here. Locally assembled cars (Brand new or used) and used JDM cars will become more expensive and out-of reach for the masses.

  2. ehalin says:

    So the new government has already acceded to and accepted its defeat. Instead of catching big fishes who never show their actual income and means of income and never pay taxes will never be caught. Tax paying Pakistanis who own above 1300cc cars i.e., who commit the mistake of buying 1500cc, 1800cc cars or occasionally a Prado or other imported cars will be the target of this wealth tax.
    The tycoons like Tareen sb do not keep any cars on their own names. Their cars are normally on the name of their companies and are shown as an expense in the P&L accounts. We ordinary citizens pay for their ayashi as well.

  3. Very easy using a laptop/mobile and criticizing each and every initiative that govt takes to help this country somehow pull out of the mess (edge of bankruptcy) intentionally created and imposed by previous governments. I guess 90% of the population of our country have no idea what we're about to witness if such steps not taken. We will be having money in our bank account but we won't have grocery to buy because there won't be water, we will have may be millions in our hands but it may only get us a loaf (currency shattered further).

    What do you do when your home expenses crosses your income/salary? You make bold steps of either cutting down your expenses or work double shift etc. Double shift is what this govt is trying to do by increasing prices etc. When your father has been employed for almost a decade and you are still not of the age of doing a job, do you ask him for money? I guess not. Money in our case is relief which the current govt cannot allow at least at this point.

  4. Relief for poor could only be provided when it's possible. What YOU people deliberately don't want to understand is that the previous two governments (PMLN's and PPP's) effed up the whole economy. When you have nothing in your bank account how are you supposed to pay salaries to the staff?

    1) Now you could say it's not your headache whether there is nothing in the account and I only care about my salary (relief). If that's what you have in mind then I'm sorry to say this, you need to educate yourself sir.

    2) Government is responsible for this, yes, but not the one that took over a mere month ago.

  5. ehalin says:

    Everybody seems to forget Ayyan Ali. Government is targeting wrong things.

    I am sorry to say the present government in its first few days has proved nothing but the fact that they are puppets in the hands of "Ghagh" bureaucrats and technocrats.

    These bureaucrats will pitch this government against the shareef tax paying public. both public and government will be the losers while these tyrant bureaucrats will win again.

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