In the fiscal year 2022-23, the federal government proposes a 2.5 percent increase in the Federal Excise Duty (FED) on all car imports. The decision is seeking approval from the federal cabinet.
According to a top Federal Board of Revenue (FBR) official, major changes to Chapter 87 of the Pakistan Customs Tariff would be included in the upcoming budget.
He also stated that imports of sports cars, minivans, off-road vehicles, golf carts, motorbikes, all-terrain vehicles (ATVs), snowmobiles, support vehicles, and vehicle assemblies, as well as components utilized in manufacture, will be subject to tariffs.
The official noted that once the new charges are in place, both locally assembled and fully built-up (CBU) automobiles are expected to become more expensive.
By abolishing tax breaks and placing new charges on numerous important industries, the government has begun to push the weight of Pakistan’s faltering economy directly onto the common populace.
Gonzalo Verela, a well-known worldwide economist, slammed the policy, tweeting:
Varela suggested that Pakistan’s expanding Current Account Deficit (CAD) is caused by a savings/investment mismatch and that the remedy is to implement measures that encourage saving.
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