Govt makes new Auto Policy, expand production, low-cost cars

s the current Auto Development Policy (ADP 2016-21) is about to end in June This yr, the federal government is making ready a new auto policy that may focus on facilitating the manufacturing of low-cost cars and incentivize auto exports. In line with multiple trade sources, roughly 45% of a car value {that a} purchaser pays goes to the government within the form of duties and taxes. The government charges duties on imported CKDs (fully knockdown units), the auto parts used in assembling cars.

The Customs duty on import of localised parts is 45%. The duty on non-localised parts is 30%. There is an extra 7% duty on the import of parts.

    Federal Excise Duty on cars:

    2.5% on cars up to 1000cc

    5% on cars between 1000cc and 2000cc

    7.5% on vehicles above 2000cc

Along with this, there is a 17% sales tax.