Concerns over Pakistan import duties took center stage during a meeting of the National Assembly Standing Committee on Commerce, where lawmakers described the current vehicle taxation structure as irrational and counterproductive. Members argued that the existing duty regime has distorted the market, making small, affordable cars increasingly expensive while offering relative relief to larger and more expensive vehicles.

The discussion reflected growing frustration over how Pakistan import duties are impacting ordinary consumers, particularly middle- and lower-income households that rely on smaller vehicles for daily mobility.

Small Cars Hit Hardest by Pakistan Import Duties

Committee member Shaista Pervaiz highlighted what she termed a “ridiculous imbalance” in Pakistan import duties. According to figures shared during the meeting, vehicles with engine capacity up to 850cc are subject to a 55 percent duty. In contrast, cars ranging between 1300cc and 1800cc face import duties of 65 percent and 75 percent respectively.

Lawmakers noted that despite being positioned as entry-level options, small cars now carry price tags that are increasingly out of reach for average buyers. This outcome, they argued, runs counter to the stated objectives of Pakistan import duties, which are meant to encourage affordability and local mobility rather than penalize it.

Confusion Over Duties on Large Vehicles

The committee was also briefed on the treatment of high-end vehicles under Pakistan import duties. While large cars officially carry a 200 percent regulatory duty, officials confirmed that this rate has effectively been reduced by 90 percent under the new tariff policy. As a result, the practical duty burden on such vehicles now stands at around 50 percent.

Members questioned how this reduction aligns with equity and economic priorities, noting that the effective easing of Pakistan import duties on luxury vehicles contrasts sharply with the heavy taxation imposed on smaller cars used by middle-income families.

Calls for Relief in Upcoming Auto Policy

Committee Chairman Javed Hanif urged the government to address these inconsistencies in the forthcoming auto policy. He stressed that Pakistan import duties must be restructured to ensure that small and fuel-efficient cars become more affordable rather than more expensive.

He emphasized that without corrective measures, Pakistan import duties risk deepening inequality in vehicle ownership and undermining broader economic goals such as energy efficiency, reduced congestion, and accessible transportation.

Broader Economic Impact of Pakistan Import Duties

Experts attending the session noted that skewed Pakistan import duties not only affect consumers but also disrupt the local auto industry. Higher prices for small vehicles discourage demand, limit market growth, and place additional pressure on households already grappling with inflation, high fuel costs, and rising interest rates.

The committee agreed that a rationalized duty structure could stimulate demand, support local assemblers, and improve overall market stability, provided Pakistan import duties are aligned with income realities and long-term planning.

Related: agriculture exports

Update on Gold Jewelry Export Ban

In a separate agenda item, officials briefed the committee on the ongoing ban on gold jewelry exports. The restriction, imposed through an FBR statutory regulatory order in May, is set to remain in effect until June 30. However, Ministry of Commerce representatives confirmed that a formal summary has been sent to the Prime Minister seeking approval to lift the ban.

Members noted that easing export restrictions could provide relief to exporters and improve foreign exchange inflows, much like reforms to Pakistan import duties could support domestic economic balance.

A Growing Demand for Policy Correction

The session concluded with renewed calls for a comprehensive review of Pakistan import duties, particularly in the automotive sector. Lawmakers stressed that unless urgent adjustments are made, the current framework will continue to burden ordinary citizens while offering disproportionate advantages to higher-end segments of the market.