Islamabad, October 29, 2025 – The Federal Board of Revenue (FBR) has announced a record-breaking collection of Rs13 billion in sales tax from motor cars during the fiscal year 2024-25 (FY25), reflecting the rapid recovery and expansion of Pakistan’s automobile sector.
According to the FBR’s annual revenue collection report, the sales tax collection on motor cars soared by an impressive 159%, compared to Rs34.58 billion recorded in the preceding fiscal year. This surge is attributed to a significant jump in both production and sales volumes across the automotive industry.
During FY25, the production of motor cars increased from 79,594 units in FY24 to 111,402 units, while sales rose from 81,579 to 112,203 units. The combination of higher demand, increased local assembly, and steady tax compliance fueled the growth in sales tax revenue from this sector.
The FBR report highlighted that Sales Tax (Domestic) from the automobile sector alone contributed notably to the overall tax performance. The domestic sales tax collection reached Rs1,619.5 billion, showing a 32.4% increase compared to Rs1,222.9 billion in the previous fiscal year.
Similarly, the sales tax collection on motor cycles also showed remarkable growth of 136.2%, driven by increased manufacturing and consumer demand. Production volumes rose from 1.15 million to 1.51 million units, while sales climbed from 1.15 million to 1.52 million units during FY25.
Overall, the total sales tax collection amounted to Rs3,901.4 billion, marking a 26.4% year-on-year (YoY) increase, and achieving 98.3% of the set target. Of this, 33.2% of total federal revenue came from sales tax, underscoring its role as a key pillar of Pakistan’s fiscal structure.
The FBR credited the success to policy reforms, improved compliance mechanisms, and steady growth in domestic manufacturing, particularly in the automobile and consumer goods sectors.