Punjab Proposes Higher Vehicle Token Tax

Punjab has proposed higher token taxes for commercial loader vehicles and private vehicles with larger engine capacities under the Punjab Finance Bill 2026.

The proposed legislation seeks a threefold increase in token tax on commercial loader vehicles. Under the new rates, vehicles with a maximum laden capacity exceeding 4,060kg but not exceeding 8,120kg will pay Rs. 6,600, compared to the current Rs. 2,200.

Vehicles with a capacity exceeding 8,120kg but not exceeding 12,000kg will be charged Rs. 12,000 instead of Rs. 4,000. Long trailers and other vehicles with a capacity exceeding 12,000kg but not exceeding 16,000kg will pay Rs. 18,000, up from Rs. 6,000.

For vehicles exceeding 16,000kg, the proposed token tax has been increased from Rs. 8,000 to Rs. 24,000 annually. The bill also proposes higher token tax rates for private vehicles with larger engine capacities.

Vehicles with engine capacity exceeding 1,000cc but not exceeding 2,000cc will be taxed at 0.3 percent of invoice value, compared to the existing 0.2 percent rate. For vehicles above 2,000cc, the proposed rate has been increased from 0.3 percent to 0.4 percent of invoice value.

The proposed changes are part of the Punjab Finance Bill 2026 and will take effect after approval by the provincial assembly.