FPCCI demands rollback of high taxes on hybrid cars

According to Dawn, the Federation of Pakistan Chambers of Commerce and Industry has called for a rollback of higher sales tax on hybrid vehicles. The general sales tax on hybrid and plug-in hybrid vehicles returned to 25 per cent once concessions lapsed on June 30, up from 8.5 per cent for hybrids up to 1800cc and 12.75 per cent above that. The chamber's Adeel Siddiqui said the change came because no new auto policy had been notified in time.

Automakers have reportedly paused production and stopped issuing invoices, since they are unsure which tax rate to apply. The halt is said to have hit thousands of employees and suppliers, along with transporters, who are losing income. The chamber also argued that costlier hybrids weaken energy security, as Pakistan imports roughly 80 per cent of its petroleum products.

The chamber has demanded an immediate rollback to 25 per cent, or at least a reduction to 18 per cent until the new auto policy is finalised. It questioned why hybrids, which offer lower running costs, face higher taxes while relief is reportedly being considered for vehicles above Rs10m. The statement urged early notification of Auto Policy 2026-31 to restore clarity and stability.