Buyers of vehicles above 3000cc will now pay Rs500,000 after 100% increase. The advance tax will now be Rs400,000 for vehicles between engine size 2500cc and 3000cc instead of Rs200,000. Tax on cars between the engine size of 2000cc and 2500cc has also been doubled to Rs300,000.
Buyers of automobiles of engine size between 1800cc and 2000cc would pay Rs200,000 after an 100% increase. The car sales of bigger cars of engine size 1600cc and above may also see their sales declining due to increase in advance tax in the budget, which is likely to apply from July 1, 2022.Ĭar buyers of engine sizes between 1600cc and 1800cc will pay advance tax of Rs150,000 after an increase of Rs75,000.
Moreover, historic high inflation would also reduce buying power, subsequently affecting car sales. The sector was already struggling to keep the last year’s momentum amid rising policy rate, which has reached to 13.75%, State bank’s restrictions on auto financing such as reduced tenure (from 7 years to 3 years in bigger cars and from 7 to 5 years for cars below 1000cc) and a maximum loan availability of Rs3 million from banks.Įxperts say this would significantly affect demand since up to 40% car sales used to come from auto financing. However, experts say the sales may drop below 200,000 units in fiscal year 2023 amid increased advance tax, also known as withholding tax, on cars above 1600cc. Car makers sold 251,000 units (data of car assemblers who are members of Pakistan Automotive Manufacturers Association). The auto industry displayed a significant growth of 50% in the 11 months of the outgoing fiscal year 2022. The government is looking to increase the advance tax of bigger engine cars (1600cc) in the budget 2022-23 while high price, increase in interest rates, inflation, and increase in restrictions by the central bank on auto financing is expected to reduce car demands by up to 25%. Stock Photo by THP 7 / 179 Bumpy Rural Road Picture by beinder 2 / 196 country road Stock Photo by prawny 4 / 373 Solutions For Business Stock Images by focalpoint 8 / 77 Bumpy road Stock Photography by 4774344sean 1 / 34 Bumpy road Stock Image by focalpoint 8 / 465 3d Render of a Bumpy Road Picture by apotterdd 1 / 131 bumpy road Stock Photography by prawny 2 / 880 Bumpy road backdrop Stock Image by 4774344sean 2 / 27 Bumpy road Picture by smuay 2 / 12 Bumpy road background Stock Photo by 4774344sean 2 / 39 Bumpy road leading to city Stock Photography by 4774344sean 2 / 53 Bumpy road background Stock Photos by 4774344sean 2 / 32 Bumpy road background Stock Photos by 4774344sean 2 / 40 Bumpy Road Ahead Yield Sign Stock Photos by ulegundo 3 / 107 Bumpy road background Stock Photo by 4774344sean 1 / 15 Bumpy road background Stock Photo by 4774344sean 1 / 24 bumpy road Stock Photo by maurus 2 / 4 Bumpy road background Stock Photo by 4774344sean 1 / 36 bumpy road Stock Photos by maurus 1 / 9 Bumpy road Stock Photography by 4774344sean 0 / 48 Bumpy road Stock Photography by 4774344sean 0 / 14 Bumpy road Stock Photography by 4774344sean 0 / 16 Bumpy road Stock Photography by 4774344sean 0 / 27 Slow down, bumpy road ahead.High prices, increase in taxes, and interest rates to squeeze car demand Bumpy road background Stock Photos by 4774344sean 1 / 22 Bumpy road Stock Images by PinkBadger 1 / 13 Bumpy road background Stock Photos by 4774344sean 1 / 17 Heat haze rises and the road gets a little bumpy.
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