The federal government has proposed a 1% NEV (New Energy Vehicle) Adoption Levy in the 2025–26 budget, targeting petrol-powered cars with engine capacities ranging from 660cc to 1300cc. The new levy aims to support electric vehicle development and infrastructure by generating revenue from conventional fuel vehicles.
The proposed 1% levy would be added to the ex-factory price of eligible vehicles, resulting in modest price increases across some of Pakistan’s most popular small and mid-range car models.
Here’s how the prices are expected to change:
| Vehicle Model | Current Price (₨) | Expected Price (₨) |
|---|---|---|
| Suzuki Alto VXR | 2,827,000 | 2,855,270 |
| Suzuki Alto VXR AGS | 2,989,000 | 3,018,890 |
| Suzuki Alto VXL AGS | 3,140,000 | 3,171,400 |
| Suzuki Cultus VXR | 4,230,000 | 4,272,300 |
| Suzuki Cultus VXL | 4,316,000 | 4,359,160 |
| Suzuki Cultus AGS | 4,618,000 | 4,664,180 |
| KIA Picanto 1.0 AT | 3,940,000 | 3,979,400 |
| Honda City 1.2L M/T | 4,649,000 | 4,695,490 |
| Honda City 1.2L CVT | 4,689,000 | 4,735,890 |
| Peugeot 2008 Active | 6,600,000 | 6,666,000 |
| Peugeot 2008 Allure | 7,250,000 | 7,322,500 |
According to officials, the new levy is designed to generate funding for EV infrastructure and support the government’s broader environmental goals. By shifting a small tax burden onto buyers of internal combustion engine (ICE) vehicles, the policy hopes to gradually steer demand toward greener alternatives.