LAHORE, May 30, 2025: The Excise, Taxation and Narcotics Control Department has proposed increase in the registration fees of cars and motorcycles for the upcoming fiscal year.
The proposal suggests to increase the registration fees of cars with engine capacity of 1,000 CC from currently Rs. 1,200 to Rs. 5,000.
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The registration fee of vehicles with engine capacity above 1,000 CC and up to 1,800 CC is proposed to be increased from Rs. 2,000 to Rs. 11,000. Likewise, the proposal includes to hike the registration fees of vehicles above 1,800 CC engines from Rs 3,000 to Rs 22,000.
The registration fee of HTV has also been proposed to be increased from Rs 4,000 to Rs 11,000.
FBR PROPOSED HIGHER TAXES ON VEHICLES AS WELL
Just two days ago, the Federal Board of Revenue (FBR) also recommended a hike in withholding tax for vehicles above 1300 CC engines for the upcoming Budget 2025-26.
Currently, 2% withholding tax is being charged on the total value of vehicles with engine capacity of 1300 CC to 1600 CC. For cars upto 1800 CC the tax rate is 3%, and it progressively increases to 5% for cars upto 2000 CC, 7% for vehicles upto 2500 CC, 9% for vehicles upto 3000 CC, and 12% for cars with engines above 3000 CC capacity.
READ MORE: FBR Recommends Higher Taxes on Cars
However, the FBR has recommended increase in this rate of tax as a means to generate additional tax revenue. In the previous budget, taxes on vehicles were shifted from fixed tax rates to value-based taxes with vehicle prices becoming the primary determinant of withholding tax calculations. As a result, during FY25, the FBR has reported collection of over Rs 4 billion in vehicles tax.
