Islamabad, June 18, 2025: in a recent development during the ongoing budget talks, the Senate Standing Committee on Finance strongly opposed the proposed GST hike on small cars, especially vehicles up to 850cc, in the Finance Bill 2025. The session, chaired by Senator Saleem Mandviwalla, marked the committee’s fifth consecutive meeting to review budgetary measures presented in Parliament.
Finance Minister Muhammad Aurangzeb, Minister of State for Finance Bilal Azhar Kayani, FBR Chairman Rashid Mahmood Langrial, and other senior officials attended the meeting to discuss key fiscal amendments.
One of the major concerns raised was the increase in General Sales Tax from 12% to 18% on smaller vehicles. The committee members criticized the move, suggesting a moderated rate of 14% or 15% instead, to offer relief to middle-class car buyers.
Senator Shibli Faraz stressed the unfair burden placed on small car owners, pointing out the disparity in tax benefits provided to other sectors and regions. He urged the government to reconsider policies that disproportionately affect the working class.
Senator Mandviwalla appreciated the active involvement of lawmakers, calling this year’s budget dialogue more inclusive and transparent. He stated that such participation ensures that the final Finance Bill reflects the collective will of the people.
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The debate over the GST on 850cc cars remains a focal point, with the Senate pushing for adjustments to protect lower-income consumers amid economic challenges.
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