The Federal Board of Revenue (FBR) has officially notified the rates for the New Energy Vehicle (NEV) adoption levy, targeting both locally manufactured and imported internal combustion engine (ICE) vehicles.
The move is part of the government’s push to encourage the use of electric and energy-efficient vehicles.
Under the new tax regime, a 1% ad valorem levy—based on invoice price including duties and taxes—will apply to locally assembled or manufactured ICE motor vehicles with engine capacities below 1300CC.
The same 1% rate will also apply to imported vehicles in the same category, calculated on their assessed value.
For vehicles with engine capacities between 1300CC and 1800CC, the levy increases to 2% for both local and imported units.
Meanwhile, ICE vehicles with engine capacities exceeding 1800CC will be subject to a 3% levy—again applicable to both local manufacturers and importers.
The levy also extends to commercial vehicles. Imported buses and trucks with combustion engines will face a 1% levy, while the same rate applies to locally assembled buses and trucks.
Yes more taxes so people don’t buy cars
Is this levy to help reduce price of EV ?
If the levy is on fuel or traditional cars, then yes, it helps reduce EV prices by funding incentives.
If the levy is on EVs, then no, it increases their cost.
Instead of giving relief on NEVs, it’s crazy to put more tax on other vehicles.
Why don’t just give some extraordinary tax relief on EVs so that they can be adopted by people, hence creating a new ecosystem for EVs. Even with this additional levy, gasoline vehicles will stay because of the existing ecosystem.