Pakistan has made a noteworthy move to eliminate regulatory duties on imported used cars with engine capacities up to 1,800cc and to lower duty rates on various goods, including new cars and mobile phones. This decision was made because the government’s previous strategy of heavily taxing imports had a minimal impact on revenue but severely affected businesses within the country.

The decision was made after two Statutory Regulatory Orders (SROs) lapsed on March 31st and the chairman of the Tariff Policy Board declined to extend them any further. This decision means that a range of items, such as new and used cars, high-tech mobile phones, home appliances, meat, fish, fruits, vegetables, footwear, furniture, musical instruments, dog and cat food, and ice-cream, will now become more affordable for consumers. In particular, the regulatory duty on used cars with engine capacities up to 1,800cc has been abolished completely, providing significant relief to consumers.

However, new cars in this category will still be subject to a 15% regulatory duty, in addition to other taxes. Duty rates on mobile phones have also been halved across all categories.

This decision is expected to benefit approximately 500 to 700 imported cars with varying engine capacities that have been stuck at ports due to a lack of foreign currency. While new cars with engine capacities over 1,800cc will still have low regulatory duty rates, additional custom duties have been removed on these vehicles, resulting in a significant reduction in prices.