The Pakistan Auto Policy 2026–31 is stuck on one question: how fast should car import duties fall. A ministerial committee led by the Power Minister is reported to be seeking the Prime Minister's guidance on 24 October 2026, because the Commerce and Industries ministries still disagree on the tariff structure. The previous policy expired on 30 June, so buyers, assemblers and parts makers are all waiting.
Why the Auto Policy 2026–31 Faces a Tariff Dispute
On 20 October several outlets reported that the Prime Minister had cleared the draft and that it would go to the federal cabinet. The latest report shows the hardest part is still open. An official involved in the talks said the government has to choose between the National Tariff Policy and the auto policy, because both cannot run at the same time.
The National Tariff Policy 2025–30 sets a maximum customs duty of 15% by 2030 and removes regulatory duties. Some vehicle categories currently carry combined duties as high as 156%, so the gap between the two positions is wide.
What the Commerce and Industries Ministries Disagree Over
| Issue | Reported position | Reported |
|---|---|---|
| Duty ceiling | National Tariff Policy: maximum 15% customs duty by 2030 | Cabinet-approved |
| Industries Ministry proposal | 60% for 1,501–1,800cc, 45% for 1,001–1,500cc and 75% above 1,801cc by 2030 | August |
| Commerce Ministry | One-year delay before lower tariffs, still aiming for 15% | August |
| CKD kits and parts | Industries says these duties fall under the Tariff Policy Board and asks for an interim mechanism | 24 October |
| Electric vehicles | A uniform tariff structure for all NEVs is under consideration | 24 October |
Based on reports in Business Recorder, Express Tribune, ProPakistani and Bloom Pakistan. These are proposals, not rates in force.
The ministry that writes the auto policy says the tariff rules for CKD kits, raw materials, subcomponents and assemblies belong with the Tariff Policy Board. It wants an urgent board meeting to agree on a temporary way of setting duties until the policy is final. Talks also slowed because the Power Minister was in Saudi Arabia and the Commerce Secretary was in Washington for trade talks with the United States.
Proposed Tariff Cuts Through 2030–31
The August Industries proposal was about 34% below the duty on 1,501–1,800cc cars at that time, yet still four times the National Tariff Policy ceiling of 15%. Auto manufacturers and parts makers have written to the Prime Minister warning that deep cuts could close assembly plants and put investment and jobs at risk. Reports in September and October describe later drafts that move toward 15% by the 2030–31 financial year, but those drafts differ from each other, so treat every figure as unconfirmed until a notification is issued.
How the Dispute Affects NEV Tariffs and EV Buyers
The New Energy Vehicle Policy 2025–30 aims for electric vehicles to reach 30% of new vehicle sales by 2030. Delays in the auto policy are creating uncertainty for investors over localisation rules, export obligations and the future tariff regime. BYD has announced plans for local production through a partnership, and Geely has shown interest in entering the market.
On taxes, reports say the government rejected an IMF proposal to raise sales tax on electric vehicles to 18%, but PakWheels notes that the NEV tax treatment is still not final and that the IMF had earlier objected to concessional rates. If you are shopping for an EV or hybrid, the tax category your car falls into may still change.
Could the Proposed Changes Reduce Car Prices?
Possibly, over several years, but nothing is guaranteed. Lower duties could make some imported and hybrid cars cheaper, yet the policy still needs approval and manufacturers have not committed to price cuts. An earlier draft also reportedly planned extra excise duty on conventional vehicles to offset part of the reductions. The sensible approach is not to delay or rush a purchase on the strength of a draft alone.
What Happens Next?
Next the committee takes the tariff question to the Prime Minister, the Tariff Policy Board may meet to set an interim mechanism, and the policy still needs federal cabinet approval before it can take effect. Until then the old duties remain, and only an official notification will confirm new rates. For more car news and guides, explore our blog.
Final Thoughts
The Pakistan Auto Policy 2026–31 has cleared an important political step, but its tariff structure is not settled. The decision between the National Tariff Policy and the auto policy will shape CKD duties, EV taxes and eventually what you pay for a car. Whatever the outcome, genuine, exact-fit accessories remain the best way to protect the car you already own.
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