The federal government has proposed a significant tax hike in its 2025–26 budget, targeting hybrid vehicles with a sharp increase in General Sales Tax (GST) from the existing 8.5% to 18%. This change will lead to a substantial rise in the prices of several popular hybrid models available in Pakistan.
GST Increase to Affect All Powertrains
As part of broader tax reforms, the government intends to apply a flat 18% GST to all vehicles, whether petrol, diesel, or hybrid. Previously, hybrid vehicles enjoyed a reduced GST rate of 8.5% to incentivize cleaner mobility. The new policy eliminates that advantage.
Price Hikes Across Leading Hybrid Models
According to data compiled by PakWheels, the following hybrid vehicles will see major price increases if the proposal takes effect:
| Vehicle Model | Old Price (8.5% GST) | New Price (18% GST) | Expected Increase |
|---|---|---|---|
| Haval H6 HEV 1.5L | ₨ 11,749,000 | ₨ 12,777,714 | ₨ 1,028,714 |
| Haval Jolion 1.5L | ₨ 9,295,000 | ₨ 10,108,848 | ₨ 813,848 |
| Toyota Corolla Cross 1.8 HEV | ₨ 8,999,000 | ₨ 9,786,931 | ₨ 787,931 |
| Toyota Corolla Cross 1.8 HEV X | ₨ 9,449,000 | ₨ 10,276,332 | ₨ 827,332 |
| Hyundai Elantra Hybrid 1.6L | ₨ 9,700,000 | ₨ 10,549,309 | ₨ 849,309 |
| Hyundai Tucson Hybrid Smart 1.6L | ₨ 10,999,000 | ₨ 11,962,046 | ₨ 963,046 |
| Hyundai Tucson Hybrid Signature 1.6L | ₨ 11,999,000 | ₨ 13,049,604 | ₨ 1,050,604 |
| Hyundai Santa Fe Smart 1.6L | ₨ 12,490,000 | ₨ 13,583,594 | ₨ 1,093,594 |
| Hyundai Santa Fe Signature 1.6L | ₨ 13,899,000 | ₨ 15,115,963 | ₨ 1,216,963 |
| Kia Sportage L HEV 1.6L | ₨ 10,999,000 | ₨ 11,962,046 | ₨ 963,046 |
| Kia Sorento 1.6T HEV FWD 1.6L | ₨ 14,699,000 | ₨ 15,986,009 | ₨ 1,287,009 |
| Kia Sorento 1.6T HEV AWD 1.6L | ₨ 15,999,000 | ₨ 17,399,834 | ₨ 1,400,834 |
| MG HS PHEV 1.5L | ₨ 9,699,000 | ₨ 10,548,221 | ₨ 849,221 |
Industry Concerns
The proposed tax increase has raised concerns among automakers and prospective buyers alike. Hybrid vehicles, often marketed as a fuel-efficient and eco-friendly option, will become significantly less affordable under the new tax regime. Industry experts warn that this move could dampen demand for hybrids and slow the country’s transition to cleaner mobility.
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They already cost 1 crore . No one is buying them anymore. Salaries are only 1 lac. It’ll take 10 years to buy 1 car. No thanks.
I love how journalism is censorship . Hope you remain begging
beggars trying to be choosers.
This is called enemy budget they are not thinking about Pakistani people it is very very different for Pakistani people to buy a car wrong and not sensible decision by government to increase all car prices government do not give relief to Pakistani people they are only thinking how to benefit minister’s MNA and other elite class they are not thinking about Pakistani people we will celebrate 78 years of Independence but still struggling to survive
Car makers have already collected their profit in advance on hybrid I mean the money we will save on petrol during next 10 years why they should be bothered, however, those who plan to buy these vehicles will have no issue paying more, the bad part is only polluted air remains to be taxed rest even water is taxable, God Bless Pakistan
Absolutely shameful behaviour from gov. Hypocrisy at its finest, at one side they want clean energy cars and are starting emission tests in lahore and on the other side they are making HEV which were barely affordable already for the middle-upper class untouchable so they all have to buy ice vehicles which hurt the environment more. A standing ovation for such hypocritical U-turns by current regime.
The above information is absolutely incorrect.
The reduced rate of General Sales Tax (GST) of 12.5% that previously applied to motor vehicles up to 850cc is being increased and standardized to 18%, aligning it with the general GST rate.
No GST impact or change is being made to motor vehicles above 850cc, indicating that these were already subject to the standard rate and will continue as such.