Motor Vehicle Tax

The Excise & Taxation Department collects the Motor Vehicles Tax. It contributes considerable income to the exchequer and is another major source of revenue. It is administered under the provisions of the Motor Vehicle Ordinance, 1965, and Motor Vehicle Tax Act, 1958. In accordance with the proposed Finance (Supplementary) Act, 2022, the government of Pakistan will withdraw sales tax exemptions in the amount of Rs 343 billion from January 16, 2022.

The Chairman of the Federal Board of Revenue, Dr. Muhammad Ashfaq Ahmed, told the media at the conclusion of the first computerized draw to award the POS Prize held at the FBR (HQs), that the president has given assent to the Finance (Supplemental) Act, 2022 to remove sales tax exemptions given to the elite class and powerful lobbies and cartels.

Under the Finance (Supplementary) Act, 2022, the sales tax would become effective the next day after the president’s assent. In this regard, the Government of Sindh also ensured sales tax by amending certain laws. Clause (3) of the table, the rate of tax under sub-section (2A) of Section 231B shall be substituted as follows: