The Federal budget for 2024-25 was revealed earlier today (Wednesday) by Finance Minister Senator Muhammad Aurangzeb.
One of the measures that has been proposed is likely to push up prices of all motor vehicles.
Currently, the advance tax on vehicles is calculated on basis of engine capacity (up to 2000cc displacement.
As per new measures proposed in the budget, advance tax on buying and registration of cars will be a percentage of the invoice value of cars, not the engine capacity.
The justification that the Federal govt is giving for the move is that ‘prices of cars have increased significantly’. Therefore, taxation should be done as per cars’ invoice value, not engine capacity to ‘take full tax benefit’.
The rates for this new mechanism are yet to be announced.
