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WHAT IS THE TAX ON ELECTRIC VEHICLES(EV) IN PAKISTAN?

In Pakistan, electric vehicles (EVs) are taxed based on their price, battery capacity, and type of vehicle. The exact amount of tax can vary depending on the specific model and make of the car.

Below is a general overview of the tax structure for EVs in Pakistan:

  • Federal Excise Duty (FED): This is a federal tax levied on the manufacturing of goods in Pakistan. The amount of FED on EVs ranges from 2% to 6% of the vehicle’s price, depending on the price bracket.
  • Sales Tax: This is a tax levied on the sale of goods in Pakistan. The sales tax on EVs is 20% of the vehicle’s price.

In addition to these taxes, there may be other fees and duties associated with importing and registering EVs in Pakistan.

Types of Electric Vehicles in Pakistan:

  1. Battery Electric Vehicles (BEVs): These are vehicles that run solely on electricity stored in their batteries.
  2. Plug-in Hybrid Electric Vehicles (PHEVs): These are vehicles that have both an electric motor and a conventional internal combustion engine. They can be charged through a plug-in charging port and can run on either electricity or gasoline.
  3. Hybrid Electric Vehicles (HEVs): These are vehicles that have both an electric motor and a conventional internal combustion engine. However, unlike PHEVs, they cannot be charged through a plug-in charging port and rely on regenerative braking to recharge their batteries.

It is important to note that the above information is subject to change and it is always recommended to check with the relevant authorities for the most up-to-date information.

Some Key points from the Electric Vehicles Policy 2020-2025 by the Pakistan’s federal cabinet are listed below:-

  1. Exemption from customs duty and additional sales tax on the import of four-wheel electric vehicles.
  2. 1% sales tax on locally manufactured EVs with power up to 50/kWh.
  3. 1% sales tax on light vehicles with power up to 150/kWh.
  4. Import duty on the import of batteries and charging equipment reduced to 1%.
  5. No Federal Excise Duty (FED) for the manufacture or sale of EVs.
  6. 1% tax on the import of electric vehicle parts and spare parts.
  7. No registration fee for EVs.
  8. No annual renewal fee for electric vehicle producers in the ICT sector.
  9. No customs duty on the import of plant and machinery.
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