The Federal Board of . (FBR) has imposed a 40% regulatory duty on commercial imports of old and used cars. This applies to vehicles under PCT headings 8702, 8703, 8704, and 8711.
The notification confirms the duty is in addition to earlier levies under S.R.O. 1152(1)/2025. The Ministry of Commerce has also allowed commercial imports of vehicles up to five years old with this duty.
ECC Approval and Policy Details
The Economic Coordination Committee (ECC) approved the scheme in a meeting held on September 18, 2025. Finance Minister Muhammad Aurangzeb chaired the session. Later, the federal cabinet ratified the decision.
The new policy, announced through SRO 1895 (1) 2025, allows used vehicles less than five years old to be imported. This permission remains valid until June 30, 2026. After that, the vehicle age limit may be revised.
In addition, imports must meet strict environmental, safety, and quality standards set by the Engineering Development Board (EDB). Certification and testing requirements will ensure compliance.
Duty Timeline and Future Reductions
The government has confirmed the 40% duty will stay until June 2026. However, it will reduce gradually after that. For example, from 2026 onwards, the duty will fall by 10 percentage points each year.
By 2029-30, the regulatory duty will reach zero, following recommendations of the Tariff Policy Board. This gradual reduction aims to balance revenue needs with market demand.
As a result, used car imports will become easier and potentially more affordable in the coming years.
