Govt Slashes Customs Duty on Import of Electric Vehicle Parts to 1 Percent

In a statement made by Federal Board of Revenue (FBR) representatives, it was highlighted that one of the key developments is the addition of electric vehicle (EV) policy in the customs tariff. Furthermore, it was also stated that FBR has created 11 new tariff lines for the EVs.

As per this new development, the customs duty on the import of CKD parts for electric vehicles has been reduced down to 1%. However, customs duty will be 15 percent on the import of non-localized parts, while the rate of duty will be 15 percent plus additional customs duty on localized parts.


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Despite that development which apparently favors the motorists and the automakers, customs duty on the import of non-localized parts, shall be 15%. Furthermore, 15% added with additional customs duty shall be imposed on localized parts.

According to the budget, the state authorities shall allow the concession for five successive years on the import of 10 electric vehicles of the same trim level in ‘CBU’ form, effective from July 2020.

The concession shall be allowed to the automakers in order for them to manufacture or assemble a maximum of 200 similar vehicles. Though this practice would also require approval for the Engineering Development Board (EDB).

Also, the 2 and 3 wheeled EVs can be imported at 50% of the current customs duty tariff rates and the commercial heavy-duty EVs can be imported at 1% customs duty.

The government is in active pursuit of introducing EVs as a common means of transportation in the country, hence the recently reported development, and other incentives such as 0% interest rates on car financing of the EVs among many others. These developments, if followed both in letter and spirit, can bring about significant improvements to the Pakistani automotive culture and industry.