Senate Committee Rejects Proposed Tax on Hybrid and Electric Vehicles

Islamabad: In a meeting led by Senator Salim Mandviwala, the Senate Standing Committee on Finance firmly opposed the proposed tax on hybrid and electric vehicles in the new budget.

During the session, the chairman of the Federal Board of Revenue (FBR) revealed that the 25% tax exemption for vehicles over Rs15 million had been removed, clarifying that this was a proposal from the Ministry of Industries and Production, not an FBR decision.

Senator Faisal Vawda expressed his discontent, stating, "Tax on hybrid and electric vehicles is not acceptable." He urged the committee to summon the concerned minister for an explanation and warned, "This tax must be abolished, or I will speak out openly."

Vawda also criticized policy inconsistencies, stating they discouraged him from establishing industries in Pakistan.

The committee decided to call Federal Minister Rana Tanveer Hussain to explain the rationale behind the tax proposal.

In the 2024-25 budget proposals, there was a positive note for buyers of new and used hybrid vehicles with engine capacities up to 1800cc, suggesting they would continue to enjoy zero duty, providing some relief amidst expected price increases.