ISLAMABAD: The levy of withholding tax to discourage on money on transfer of motor vehicles will continue beyond July 01, 2021.
The Federal Board of Revenue (FBR) in an explanation to Finance Act, 2021 said that application of withholding tax on motor vehicles transferred without registration will continue during current fiscal year and onwards.
The FBR said that in order to discourage ‘on’ money, additional tax of Rs.50,000 , Rs.100,000 and Rs.200,000 for vehicles upto 1000 cc, between 1000cc and 2000cc and beyond 2000cc respectively was imposed where a vehicle is sold within 90 days of its ownership.
This was introduced vide Tax Laws (Amendment) Ordinance, 2021. It was applicable till 30.06.2021. Due to its positive impact, it has been continued. Further, the period of 90 days has been withdrawn.
Now the persons buying motor vehicles would be required to get them registered in their own names otherwise, this tax would be collectable.