KARACHI: Pakistan’s proposed Auto Policy 2026-31 could significantly reduce electric vehicle (EV) prices by revising sales taxes and import duties, with some battery electric vehicle (BEV) models potentially becoming around 22 per cent cheaper, according to preliminary industry estimates.
Thank you for reading this post, don't forget to subscribe!According to Topline Securities, the draft policy proposes maintaining the 1 per cent general sales tax (GST) on BEVs, while setting GST at 9pc for plug-in hybrid electric vehicles (PHEVs) and 6pc for range-extended electric vehicles (REEVs).
Under the proposed changes, BEVs with import values below $15,000 could see price reductions of approximately 22pc, while higher-priced models may become around 8pc cheaper. PHEVs could record price reductions exceeding 20pc, whereas REEVs may become approximately 3pc more expensive.
Industry estimates suggest that the GAC Aion UT, currently priced at around Rs6.4 million, could become available for Rs5m to Rs5.2m. Higher-priced electric SUVs, including the BYD Atto 3 and GAC Aion V, could also benefit from the proposed changes.
The draft policy also proposes reducing tariffs on localised completely knocked-down (CKD) parts to 15pc by fiscal year 2031, compared with the previously proposed 25pc rate. Analysts believe increased competition could encourage automakers to pass on some of the resulting cost savings to consumers.
However, the proposed policy has raised concerns among local automotive parts manufacturers, who warn that increased imports of completely built-up vehicles could undermine domestic production and threaten local industry investment.
The proposed measures aim to encourage the adoption of new energy vehicles (NEVs), particularly battery electric vehicles, by improving affordability. The final impact on EV prices will depend on the policy’s approval, implementation and how manufacturers adjust their pricing.
Story by Kalbe Ali
