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.