Completely built-up (CBU) cars are now subject to a higher regulatory duty (RD) and other taxes imposed by the Federal Board of Revenue (FBR) on the importation of non-essential or “luxury” goods.
For the layman, CBU means a fully built car that is more expensive vs a complete knock-down (CKD) kit which has car parts that need to be assembled and is cheaper.
The board has increased regulatory charges on the import of automobiles with engines larger than 1000cc by 85%, according to sources. The new rate is 100%, compared to the former rate of 15%. This suggests that there will be a significant price hike for CBUs.
A Statutory Regulatory Order (SRO) 1571(I)/2022 was issued by the Federal Board of Revenue (FBR) to inform people of the RD increase and to forbid the import of opulent CBUs into Pakistan. The action is being taken to stop additional inflation and foreign exchange reserve depletion.
The board has also imposed 35% additional customs duty (ACD) on vehicles under the following PCT codes:
- 8703.2323 — Sport utility vehicles -SUVs 4×4
- 8703.2329 — Sedans and Hatchbacks)
- 8703.2490 — diesel-powered vehicles
- 8703.3223 — CKD or SKD kits for SUVs
- 8703.3225 — all-terrain vehicles (4×4)
- 8703.3229 — Commercial vehicles
- 8703.3390 — Other vehicles with internal combustion engines or electric motor
- 8703.9000 — Vehicle included the SRO.1517(I)/2022.
Miftah Ismail, the federal minister of finance, lifted the import restriction on luxury and non-essential goods, including Completely Built-Up (CBU) automobiles, last week. He did, however, add that the government would levy high taxes to make importing all but impossible.
