Excise and Taxation Remove Luxury Tax on Imported Vehicles

Punjab Excise and Taxation Department has proposed to remove the luxury tax on the registration of the imported vehicles. This proposal has been given by considering negligible imposition of tax in other provinces. The luxury tax has affected the outflow of foreign exchange. Due to difference of the luxury tax among the provinces, the consumers are getting their cars and other vehicles registered in Islamabad and they bypass the luxury tax in Punjab.
The excise and Taxation Department said that the minor registration charges are received from the consumers and this is the main reason that most of the people flock to the capital territory. As most of the people want to buy imported vehicles over 1300cc engine capacity, they also look for evasion of the luxury tax. The government imposed the luxury tax on the registration o the imported vehicles in June 2016 and the engine have the capacity of 1300 cc. according to the new policy, the tax of Rs.70,000 for 1300cc cars and Rs.150,000 for the cars having 1500 cc engine capacity. For the engine having capacity over 2000cc, Rs.200,000 will be charged as the luxury tax. The luxury tax charged on the import of the vehicle does not include the custom duty, token tax, withholding tax and registration fee. The officials of excise and customs told that removal of the luxury tax will multiply the number off registrations in the province and it would add the revenue to the excise department.