Pkrevenue.com

Category: Automotive

PkRevenue provides stories related to automotive industry. We focus on auto policy of Pakistan. The coverage also includes sales of domestic manufacturing.

  • Mobilink Bank, Universal Motors sign financing deal

    Mobilink Bank, Universal Motors sign financing deal

    KARACHI: Mobilink Microfinance Bank Limited (MMBL) has signed a Memorandum of Understanding (MoU) with Universal Motors (Private) Limited for financing motor vehicles.

    The collaboration will facilitate MMBL Borrowers by allowing them to finance commercial vehicles from Universal Motors through subsidized offerings, according to a statement issued on Monday.

    President & CEO MMBL, Ghazanfar Azzam, and Adil Noman, CEO Universal Motors signed the MoU in Islamabad with senior officials from both organizations in presence.

    The collaboration will usher in fast-track and priority financing for MMBL borrowers to attain commercial vehicles from Universal Motors for starting or expanding their business operations, under convenient terms.

    Following the MoU, MMBL customers will get fast product delivery Turnaround Times (TAT), in addition to the provision of 1S/2S/3S dealership or retailer services by Universal Motors, near MMBL branches across the country to extend after-sale services for borrowers.

    Creating further ease for borrowers, the vehicles will be delivered at MMBL branch cities with Universal Motors sharing the registration costs, and offering vehicle delivery from Karachi to the destination city at subsidized transportation rates.

    Sharing his thoughts at the signing ceremony, President and CEO MMBL, Ghazanfar Azzam said,” MMBL’s expansive product portfolio has witnessed a significant growth trajectory over the past few years with the introduction of more and more customer-centric products that are aimed at facilitating maximum convenience for empowering our borrowers in true sense.

    “This collaboration with Universal Motors will further solidify our aim of promoting hassle-free attainment of commercial vehicles, for business use, which will substantially be backed by quality after-sales services.”

    Adil Noman, CEO Universal Motors said, “Our collaboration with MMBL will help us target low-income groups that need financing for our sturdy and dependable JMC commercial vehicles. Universal Motors is introducing special financial incentives and logistical support to fully facilitate MMBL borrowers.

    “We are hopeful that our collaboration with MMBL will drive our shared ambition of supplementing the economic development of Pakistan.”

    Ericsson organizes virtual event for Jazz Pakistan
  • Indus Motors announces 152% growth in annual profit

    Indus Motors announces 152% growth in annual profit

    KARACHI: Indus Motor Company Limited on Friday announced 152 per cent increase in profit after tax for the year 2020/2021.

    The company declared Rs12.83 billion as profit after tax for the year 2020/2021 as compared with Rs5.08 billion in the preceding year.

    The company declared Rs163.21 as earnings per share for the year under review as compared with EPS Rs64.66 of the last year.

    Indus Motors announced Rs103.50 as dividend per share for the year as compared with Rs30 in the preceding year.

    According to analysts at Arif Habib Limited, Net sales of the company increased by 108 per cent YoY to Rs179 billion in FY21 attributable to volumetric growth of 102 per cent YoY to 57,236 units (Yaris 28,295 units, Corolla 18,355 units, Fortuner 3,543 units, Hilux 7,043 units) vs. 28,378 units (Corolla 22,140 units, Yaris 1,327 units, Fortuner 1,163 units, Hilux 3,748 units) in FY20.

    Revenue during 4QFY21 increased by 364 per cent YoY to Rs 48 billion. This is primarily owing to surge in sale of cars by 373 per cent YoY during 4QFY21 (14,566 vs. 3,078 units).

    Gross margins settled at 12.28 per cent in the quarter, up by 307bps QoQ due to appreciation of Rs against green back.

    Other income increased by 94 per cent YoY to Rs 1,686 million on account of significant jump in short term investment (government securities), and cash and bank balance.

    Effective tax rate during 4QFY21 was set at 30.75 per cent in contrast to 47.32 per cent in 4QFY20.

    Indus Motors posts 67% decline in half-year profit
  • Tax rates on purchase of motor car during 2021-2022

    Tax rates on purchase of motor car during 2021-2022

    The Federal Board of Revenue (FBR) in Pakistan has released the updated rates of withholding tax on the purchase of motor cars for the fiscal year 2021-2022.

    (more…)
  • Withholding tax rates on transfer of motor car ownership

    Withholding tax rates on transfer of motor car ownership

    The Federal Board of Revenue (FBR) in Pakistan has announced the revised rates of withholding tax applicable to the transfer of registration or ownership of motor vehicles for the fiscal year 2021/2022.

    (more…)
  • Car sales sharply increase by 114% on tax cuts

    Car sales sharply increase by 114% on tax cuts

    KARACHI: The car sales posted a sharp rise of 114 per cent in July 2021 owing to tax cuts announced in the Finance Act, 2021.

    The car sales increased to 24,918 units in July 2021 as compared with 11,659 units in the same month of the last year.

    Analysts at Topline Securities said that the sharp increase in car sales might be attributed to tax incentives announced through the Finance Act, 2021.

    The analysts said that the sales was around 27K, including non-member Lucky Motor Corporation i.e. KIA.  

    As reported by Pakistan Automotive Manufacturers Association (PAMA), car sales have increased by 114 per cent YoY to 24,918 units where the volumetric increase was mostly led by Pak Suzuki Motor Company (PSMC) and Indus Motor (INDU).

    To recall, the government had announced reliefs and tax-cuts in the federal budget which resulted in reduction in car prices across the board.

     As a result, customers had held back there purchases till July 2021.

    PSMC volumes are up by 197 per cent MoM to 15,181 units. INDU registered an increase of 48 per cent MoM to 6,715 units.

     However, HCAR sales were on the lower side with a decline of 30 per cent MoM largely due to the anticipated roll out of new model of Honda City.

    On the new-entrants front, Hyundai Nishat registered 4 per cent MoM increase to 627 units with the inclusion of its new model “Sonata”.

    Lucky Motor Corporation sold around 1,600 to 1,800 units in July-2021, which are similar volumes to the prior month.

    Car sales climb up by 54pc in 10 months
  • Honda Cars posts Rs928 million quarterly profit after tax

    Honda Cars posts Rs928 million quarterly profit after tax

    In a remarkable financial turnaround, Honda Atlas Cars (Pakistan) Limited has announced a profit after tax of Rs928 million for the quarter ended June 30, 2021.

    (more…)
  • Advance tax rates on motor car purchase, registration

    Advance tax rates on motor car purchase, registration

    The advance tax rates on motor vehicle registration and purchase from manufactures for year 2021/2022 shall be:–

    (more…)
  • Withholding tax exemption allowed on purchase of used motor vehicles

    Withholding tax exemption allowed on purchase of used motor vehicles

    ISLAMABAD: Federal Board of Revenue (FBR) has said that exemption from withholding tax has been granted on purchase of used motor vehicles from general public.

    The FBR while explaining major changes made to Income Tax Ordinance, 2001 through Finance Act, 2021 said that used vehicle market is working in an undocumented environment.

    In order to promote documentation and corporatization of this sector has been granted exemption from withholding tax on the purchase of used vehicle from general public and reduced minimum turnover tax from 1.5 per cent to 0.25 per cent .

    “Necessary changes have been made in clause (45B) of Part IV of Second schedule,” the FBR said.

  • Highlights of relief in duty, taxes for import, local supply of cars

    Highlights of relief in duty, taxes for import, local supply of cars

    KARACHI: The government has proposed relief in duty and taxes on import and local supply of motor cars up to 850CC in order to enable lower income group to purchase the motor vehicles.

    According to a commentary on budget 2021/2022 issued by KPMG Taseer Hadi & Co. Chartered Accountants, in recent years, the prices of automobiles in Pakistan have seen a sharp rise due to multiple factors, making them unaffordable for common man.

    The Finance Bill 2021 proposes to rationalize the tariff structure of the automobile sector in order to address this matter in the following manner:

    For motor vehicles up to 850cc, the Bill proposes to abolish import taxes including minimum value addition tax. In the case of locally manufactured vehicles with engine capacity upto 850cc, the Bill proposes to reduce sales tax from 17 percent to 12.5 percent and abolish federal excise duty.

    In case of local supply of locally manufactured Electric Vehicles (EV) i.e., small cars or SUVs with battery capacity up to 50 kwh and Light Commercial Vehicles(LCV)with battery capacity up to 150 kwh, the Finance Bill 2021 proposes to levy sales tax at reduced rate of 1 percent whereas import of the same is excluded from minimum value addition tax with 25 percent reduction in custom duty till 30.06.2026.

    However, import of CKD kits for these EVs is proposed to be taxed at reduced customs duty rate of 1 percent with exemption / exclusion from chargeability of sales taxand minimum value addition tax.

    In addition, the Bill proposes to reduce sales tax on Hybrid Electric cars with capacity up to 1800 cc to 8.5 percent.

    The Bill further proposes to reduce levy of minimum tax on turnover from 1.5 percent to 0.25 percent in case of persons engaged in sale and purchase of used vehicles while also abolishing withholding of income tax on purchase of used vehicles from general public.

    However, the collection of advance tax is proposed to be made from the original purchaser who sells it without registration, at the rates ranging from Rs. 50,000 to Rs. 200,000.

  • Additional withholding tax imposed on cars sold without registration

    Additional withholding tax imposed on cars sold without registration

    KARACHI: The application of withholding tax on cars / motor vehicles that are sold without registration shall pay additional withholding income tax.

    According to the Finance Bill, 2021 the withholding tax in addition to registration/transfer would be applicable and the same would be collected by the motor vehicle registration authority of Excise and Taxation Department if manufactured motor vehicles sold prior to registration by the person who originally purchased it from the local manufacturer.

    Tax analysts at KPMG Taseer Hadi Chartered Accountants said that Tax Laws (Amendment) Ordinance, 2021 inserted sub-section (2A) in Section 231B, whereby, every motor vehicle registration authority of Excise and Taxation Department shall collect advance tax at the time of sale of such vehicles from buyers of locally manufactured vehicles who sell the vehicles within 90 days of taking delivery from the local manufacturers/assemblers, whether or not registered by the respective authorities.

    The rates of withholding tax on motor vehicles sold prior registration are:

    Up to 1000CC: Rs50,000

    1000CC to 2000CC: Rs100,000

    2000CC and above: Rs200,000

    The tax analysts said that above rates were applicable till June 30, 2021.

    However, the Finance Bill, 2021 proposed to continue the provision. However, the restriction of 90 days is proposed to be done away with.