The Federal Board of Revenue (FBR) has imposed a whopping 40% regulatory duty (RD) on the commercial import of old and used vehicles, it has emerged.
According to a notification dated Oct 1, and reported Friday, the duty is in addition to regulatory duties imposed under S.R.O. 1152(1)/2025, dated June 30, 2025.
“In exercise of powers conferred by sub-section (3) of section 18 of the Customs Act, 1969 (IV of 1969), the Federal Government is pleased to levy regulatory’ duty at the rate of 40 percent on commercial import of used vehicles, falling under PCT Heading 8702, 8703, 8704 and 8711 of the First Schedule to the said act, imported under clause (xvi) of S. No. 10 of the Table of Appendix-C of the Import Policy Order, 2022 as per the condition stipulated therein,” it read.
The Ministry of Commerce had issued an SRO, allowing commercial import of up to five-year-old vehicles with 40% additional duty with immediate effect.
In its meeting on September 18, 2025, the Economic Coordination Committee (ECC) of the Cabinet, presided over by Federal Minister for Finance and Revenue Senator Muhammad Aurangzeb, had approved the scheme on a summary moved by the Ministry of Commerce.
The ECC decision was also ratified by the federal cabinet.
While the import will be subject to environmental, safety and quality standards, testing and certification requirements prescribed by the Engineering Development Board (EDB) of the Ministry of Industries and Production, nothing contained in the clause shall be construed to override, restrict or otherwise affect any provisions relating to the same PCT headings provided elsewhere in this order.
The government also approved the imposition of 40% Regulatory Duty (RD), in addition to the existing customs duties, on the commercial import of used vehicles (less than five years old).
This duty will remain applicable until June 30, 2026. Thereafter, the duty shall be reduced gradually by 10 percentage points per year, reaching zero by 2029-30, in line with the recommendations of the Tariff Policy Board.
“We don’t have any issue; we will start importing used cars,” reports quoted Indus Motor CEO Ali Asghar as saying.
“Local industry will go down and all jobs will vanish,” he added.