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Pakistan Budget 2026-27: Big Cut in Car Import Duties – Vehicles to Get Cheaper From July 1
Budget 2026-27 has slashed import duties on cars. The 1000cc-1500cc duty drops from 76% to 52%. New structure effective from July 1, 2026. Here is what it means for car buyers in Lahore.
Pakistan’s Budget 2026-27 has brought major relief for car buyers. The government has significantly slashed customs duties on imported vehicles. The new duty structure takes effect from 1st July 2026, making small and mid-size imported cars noticeably more affordable.
How Much Have Duties Been Reduced?
Under the Finance Bill 2026-27, the new customs duty structure for imported vehicles is as follows:
- 850cc vehicles: Duty reduced from 66% to 42%
- 1000cc to 1500cc: Duty reduced from 76% to 52%, a straight 24% cut
- Above 1500cc: Duty reduced from 91% to 57%
- 1800cc vehicles: Biggest reduction, from 156% down to just 74%
- 2000cc to 3000cc: 86% duty applies
- Above 3001cc: 92% duty applies
Will Your Car Actually Get Cheaper?
The 1001cc to 1300cc category sees a reduction of over 20% in Customs Duty, along with cuts in Regulatory Duty and Additional Customs Duty. This is clearly good news for buyers in the small and medium car segment.
However, keep in mind that whether this reduction passes on to you directly depends on dealers and manufacturers. Most cars sold in Pakistan are locally assembled (Suzuki, Toyota, Honda) and are not directly affected by import duties. This duty cut mainly applies to vehicles brought in from abroad.
What to Expect in Lahore?
At Rachna Motors, we see strong demand for Japanese, Korean, and Chinese imported vehicles in Lahore. With import duties falling, market pressure should bring some softening in used imported car prices as well, since fresh imports will become cheaper.
If you are planning to buy a new imported car in July 2026, it may be worth waiting a little. The new duty structure kicks in from 1st July.
What About Luxury Cars?
This relief is only for small and medium vehicles. Luxury segment cars (2000cc+) face a separate Federal Excise Duty (FED) which is pushing their prices higher. We cover that in a separate article.
The market is opening up and this government move is a clear push to make Pakistan’s car market more competitive. Wait for July 1 and then decide!