Govt slaps 11% additional customs duty on imported tyres, up to 31% on motorcycle parts

Cabinet's Economic Coordination Committee, under Finance Minister Muhammad Aurangzeb, has cleared an 11% levy on foreign-made tyres and motorcycle parts, Profit by Pakistan Today reported. Motorcycle components that manufacturers bring in rather than making locally will attract a steeper 31% charge. The approval came on Thursday at a session that also weighed financing deals, institutional reforms and infrastructure proposals.

The committee framed the move as a way to shield domestic makers by raising protection for goods produced in Pakistan and pushing carmakers to source components at home. It also amended SRO 693(I)/2006, a notification first issued on July 1, 2006, under Section 18(5) of the Customs Act, 1969, which sets extra duties on automotive parts by tariff code and vehicle type. Current rates in that schedule run from 17.5% for certain car parts to 25% to 35% for some commercial vehicle and tractor parts, with 32.5% listed for motorcycle components under heading 87.11.

The framework also grants conditional five-year exemptions to motorcycle makers introducing new technology, subject to yearly localisation goals, and to qualifying new entrants that have approved plans for local production. The differentiated rates are intended to push manufacturers toward greater domestic sourcing and cut reliance on imported parts.