Senate Committee Opposes Tax Hike on Small Cars in Budget

Jawad

17 Jun 2025

117

Senate Committee Opposes Tax Hike on Small Cars in Budget

The Senate Standing Committee on Finance and Revenue, chaired by Senator Saleem Mandviwalla, convened its fifth consecutive meeting to review the Finance Bill 2025 and the Annual Budget Statement recently presented in Parliament. Key figures such as Federal Finance Minister Muhammad Aurangzeb, Minister of State for Finance Bilal Azhar Kayani, FBR Chairman Rashid Mahmood Langrial, and other senior officials were present to explain the proposals and respond to concerns.

One of the main topics discussed was the controversial small car tax increase. The committee raised strong objections to the jump in GST from 12% to 18% on small vehicles, particularly those under 850cc. Members proposed a more moderate tax adjustment—suggesting a rate of 14% or 15% as a more balanced approach. This Senate tax decision aimed to reduce the burden on low-income families who rely on small cars for daily transportation.

Senator Shibli Faraz criticized the move, calling it unfair. He pointed out the inconsistency of offering tax relief in certain areas while small vehicle owners continue to face rising costs. This echoed broader frustration with the vehicle tax hike, which many believe disproportionately affects the average citizen.

Throughout the session, Senate opposes tax measures that seem to target common consumers. The Senate tax policy discussions reflected an intention to reassess the car tax increase as part of a wider review of fiscal fairness. The committee also emphasized that Pakistan car tax reforms should not place an undue burden on the working class.

Senator Mandviwalla acknowledged the active and meaningful participation of all members, stating that this year's car tax update discussions show a more transparent and inclusive legislative process. He noted that the Senate’s approach to reviewing tax on vehicles aims to reflect public concerns and ensure just policymaking.

Small car tax Senate tax decision Vehicle tax hike Senate opposes tax Car tax increase Small vehicle tax Senate tax policy Car tax update Tax on vehicles Pakistan car tax

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