The federal government has reduced the registration tax for commercial vehicles in the Excise and Taxation department of Islamabad Capital Territory (ICT).
A media report states that the federal government decreased the registration tax for commercial vehicles from 4% to 1%.
According to a press release issued by the Islamabad Capital Territory’s (ICT) department of Excise and Taxation, the decision was made to provide citizens with maximum relief.
Pakistan’s Biggest Tractor Manufacturer Shuts Down
This development has come shortly after the shutdown of Pakistan’s biggest tractor maker — Millat Tractors. The company cited, “continuing reduced demand of tractors and cash flow constraints,” as the reason for the indefinite shutdown.
Millat Tractors is among the most prolific automakers in Pakistan that boast the highest localization rate besides Atlas Honda (the bike company). The company’s last announcement of non-production days (NPDs) came last month due to the same reasons.
Likewise, several other car companies are observing NPDs due to the shortage of inventory and a critical demand slump. The government promised a better year for Pakistanis in terms of economic development but the latest developments in the industrial sector suggest otherwise.
Criticism for Allowing Luxury Limo Imports
The people and economic analysts have denounced the government’s recent decision to open letters of credit (LCs) for the import of luxury cars. A tweet from a renowned economic analyst Ali Khizar has shed some light on the situation.
Khizar tweeted:
65 cars are confirmed for the first batch (on January production) for delivery in March. LCs for 45 cars are opened, and remaining 20 in process.
100 plus more cars are booked for second batch (for production in March). And they company is eagerly taking more bookings.
— Ali khizar (@AliKhizar) January 7, 2023
Some sources also claim that the government has allowed the import of over 160 Mercedes-Benz luxury vehicles, although we haven’t received verification of those reports.
Recently, the State Bank of Pakistan (SBP) also eased the import sanctions on Completely Knocked Down (CKD) kits for local car assemblers.
The removal of import sanctions will enable car companies to restabilize their production and sales. Although, analysts are questioning the wisdom behind this decision amid the current economic crisis.
