FBR issues withholding tax rates on registration of motor vehicles

FBR issues withholding tax rates on registration of motor vehicles

ISLAMABAD: Federal Board of Revenue (FBR) has issued updated withholding tax rates on registration of new motor vehicles effective from July 01, 2019.

The FBR said that motor vehicle registration authorities are required to collect/deduct advance tax on private motor vehicles under Section 231B of Income Tax Ordinance, 2001 at the time of registration of new motor vehicles from persons getting new locally manufactured motor vehicles in their name.

Following are the withholding tax rates for registration of new motor vehicles under Section 231B(1):

Engine capacityTax RatePersons not appearing on ATL*
Up to 850CCRs7,500Rs15,000
851CC to 1000CCRs15,000Rs30,000
1001CC to 1300CCRs25,000Rs50,000
1301CC to 1600CCRs50,000Rs100,000
1601CC to 1800CCRs75,000Rs150,000
1801CC to 2000CCRs100,000Rs200,000
2001CC to 2500CCRs150,000Rs300,000
2501CC to 3000CCRs200,000Rs400,000
Above 3000CCRs250,000Rs500,000

** Persons not appearing in the Active Taxpayers List: The applicable tax rate is to be increased by 100 percent (Rule-1 of Tenth Schedule of the Income Tax Ordinance, 2001.

The FBR said that under Section 231B(1A) every leasing company, scheduled bank, investment bank, development finance institution, Modarba (Sharia Compliant or under conventional mode) shall collect four percent of the value of motor vehicles at the time of lease from persons not appearing in the ATL.

The FBR said that under Section 231B(2) the motor vehicle registration authority shall collect withholding tax from person transferring the ownership/registration at the time of transfer:

Engine capacityTax RatePersons not appearing on ATL*
Up to 850CCRs0Rs0
851CC to 1000CCRs5,000Rs10,000
1001CC to 1300CCRs7,500Rs15,000
1301CC to 1600CCRs12,500Rs25,000
1601CC to 1800CCRs18,750Rs37,500
1801CC to 2000CCRs25,000Rs50,000
2001CC to 2500CCRs37,500Rs75,000
2501CC to 3000CCRs50,000Rs100,000
Above 3000CCRs62,500Rs125,000

** Persons not appearing in the Active Taxpayers List: The applicable tax rate is to be increased by 100 percent (Rule-1 of Tenth Schedule of the Income Tax Ordinance, 2001.

The FBR said that under Section 231B(3) every manufacturer of motor vehicle shall collect withholding tax from purchaser at the time of sale of vehicle at the following tax rates:

Engine capacityTax RatePersons not appearing on ATL*
Up to 850CCRs7,500Rs15,000
851CC to 1000CCRs15,000Rs30,000
1001CC to 1300CCRs25,000Rs50,000
1301CC to 1600CCRs50,000Rs100,000
1601CC to 1800CCRs75,000Rs150,000
1801CC to 2000CCRs100,000Rs200,000
2001CC to 2500CCRs150,000Rs300,000
2501CC to 3000CCRs200,000Rs400,000
Above 3000CCRs250,000Rs500,000

** Persons not appearing in the Active Taxpayers List: The applicable tax rate is to be increased by 100 percent (Rule-1 of Tenth Schedule of the Income Tax Ordinance, 2001.

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