The government recently raised the General Sales Tax (GST) on vehicles with 1400cc or larger engines from 18% to 25% as part of their luxury tax in order to raise more money and comply with the International Monetary Fund’s requirements. As a result, another price increase is soon to come (IMF).
Following IMF demands, the government recently increased the General Sales Tax (GST) from 17% to 18% across the board. The new GST will cause a wave of price increases across the automotive sector, which is already having a hard time due to the weakening economy.
The new 25% General Sales Tax (GST) will be imposed on imported goods as well as locally produced 1400cc vehicles, cosmetics, pet food, footwear, imported women’s handbags, headphones and speakers, iPod, doors and windows, bath fittings, tiles, sanitary ware, chandeliers, and fancy lighting.
Due to restrictions on the import of Completely Knocked Down (CKD) kits, the automotive industry is already having trouble, and Honda Atlas Cars Pakistan Limited (HACPL) has stopped production for the entire month of March.
