The federal government plans to impose another levy on petrol and diesel vehicles in the upcoming budget to establish a dedicated Electric Vehicle (EV) fund and raise Rs. 122 billion over five years to support Pakistan’s transition towards petroleum-free transport.
Sources told ProPakistani that the levy has been proposed as a form of Federal Excise Duty (FED), which will be applicable to all imported and locally assembled petrol and diesel vehicles. The annual collection is estimated at Rs. 24 billion, with the entire five-year plan expected to generate Rs. 122 billion.
| Feebate on Internal Combustion Engine (ICE) Vehicles | FY26 | FY27 | FY28 | FY29 | FY30 | Total |
| Two and 3 Wheelers @ 1% | 3% | 3% | 2.9% | 2.8% | 2.8% | 14.5% |
| 4-wheelers (below 1300cc) @ 1% | 3.2% | 3.2% | 3.2% | 3.2% | 3.2% | 16% |
| 4-wheelers (1300cc-1800cc) @ 2% | 3.8% | 3.8% | 3.8% | 3.8% | 3.7% | 18.9% |
| 4-wheelers (Above 1800cc) @ 3% | 11.4% | 11.3% | 11.3% | 11.2% | 11.1% | 56.2% |
| Buses and Trucks @ 1% | 3.3% | 3.3% | 3.3% | 3.3% | 3.2% | 16.3% |
| Total Revenues (Billion PKR) | 24.7 | 24.6 | 24.5 | 24.2 | 24 | 122 |
The additional revenue will finance the implementation of the new Electric Vehicle Policy 2026–30, sources added.
In addition to the EV initiative, the budget proposes incentives for the local production of batteries and chargers for laptops and smartphones. However, there is no proposal to increase taxes on smartphone imports.