The Engineering Development Board (EDB) has unveiled plans to slash import tariffs on completely built-up (CBU) vehicles from the current 100 percent to just 15 percent by 2030, surprising many in Pakistan’s auto industry.
Abdul Waheed Khan, Director General of the Pakistan Automotive Manufacturers Association (PAMA), revealed that the EDB had not disclosed this steep tariff reduction during earlier consultations. Following an initial meeting with industry stakeholders, PAMA submitted feedback by May 14. However, a follow-up meeting on May 15 caught the sector off guard when the EDB announced the gradual tariff cut plan.
This move aligns with Pakistan’s recent agreement with the International Monetary Fund (IMF) to lift restrictions on used vehicle imports, allowing import duties on used cars to start 40 percent higher than new vehicles in fiscal year 2026. This premium will decrease by 10 percentage points each year, aiming for parity by 2030.
The tariff cuts are part of the upcoming National Tariff Policy (NTP) for 2025-30, set to launch on July 1, 2025. The policy aims to lower trade barriers, simplify customs procedures, and phase out additional customs duties and regulatory duties. It targets a reduction in the weighted average tariff from 10.6 percent in fiscal year 2025 to 7.4 percent by 2030.