Govt Mulling to Withdraw 10% FED on 1,700cc Vehicles: Abdul Razaq

The government is considering to withdraw its decision of imposing 10% federal excise duty (FED) on cars with engine capacities exceeding 1,700cc.

The Senate’s Standing Committee on Industries and Production, on Wednesday, was informed that the 10 percent FED imposed on locally manufactured cars and SUVs, having engine capacity exceeding 1,700cc, would be withdrawn soon.

The government had imposed a 10% federal excise duty (FED) on locally manufactured cars of 1700cc and above in the recent Finance Supplementary Bill 2019.

Succumbing to the constant pressure of local auto manufacturers and assemblers, Advisor to the Prime Minister on Commerce, Abdul Razaq Dawood, whilst briefing the Senate Standing Committee on Industries and Production, said that the decision of imposing FED on locally manufactured vehicles was being revisited.

Committee Chairman Senator Ahmed Khan said he had been informed by the government functionaries that the duty would be withdrawn next week or in the following one.

However, the Engineering Development Board mentioned that the auto sector was not consulted when this decision was made in the second mini-budget.

It was also highlighted that the sales of cars and SUVs over 1,700 cc would decrease due to the imposition of the duty, which could eventually lead to a decline in government revenue. Besides, it was also a violation of Auto Policy 2016-21.

The latest results from different assemblers show that their profits have gone down and they need assistance from the government

    • Please request the government to give benefit to those who have bought the cars in this same week by revising the sales invoice.

  • Can car companies do something to give benefit to the customers who have paid FED just one or two days before this decision of withdrawal of tax on local made cars

  • I bought aToyata Corolla grande on 2nd April and the Government has made the decision about withdrawal of FED on 4th April. I think this is our right to get the benefit by return of this extra amount as a good will of Indus Motors to the customers. I request the CEO, and the Finance Minister to do something in this regards.

    • It has hust been announced but not yet officially withdrew and like many others im in the waiting list of Withdrawal of FED to get myself new honda 😀 and if u hv any official notification of withdrawal plz share thnx

  • Any information or update on this? I have been receiving calls from Honda Atlas to deposit the remaining amount for the booking and I am waiting and hoping that if this gets implemented then I will deposit the amount accordingly?

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