Reduced customs duty regime for electric vehicle imports extended for another year under Finance Bill 2026
ISLAMABAD: The Federal Board of Revenue has notified revised customs duty rates for electric vehicle (EV) imports effective from July 1, 2026, following amendments introduced through the Finance Bill 2026.
According to the notification, a concessional customs duty rate of 25 per cent will apply to imported four-wheeler electric vehicles, excluding vehicles with a value exceeding $50,000.
The concession will remain available until June 30, 2027, as part of the government’s ongoing efforts to encourage the adoption of electric mobility and support the country’s transition towards cleaner transportation.
Concession available for locally assembled EV models
The FBR has also provided an additional incentive for manufacturers planning local assembly of electric vehicles.
Under the notified regime, imports of completely built-up (CBU) four-wheeler electric vehicles intended for local assembly and manufacturing will be eligible for customs duty at 50 per cent of the applicable concessional rate.
The facility will remain available until June 30, 2027.
However, the concession will be restricted to a maximum of 100 units per company for each vehicle variant that is subsequently assembled or manufactured locally.
EDB certification mandatory
The concessionary duty treatment will only be available to companies that obtain approval and certification from the Engineering Development Board (EDB).
The Engineering Development Board will be responsible for verifying eligibility and ensuring that imports comply with the government’s electric vehicle manufacturing and localisation objectives.
Companies seeking to benefit from the reduced duty structure must fulfil all conditions prescribed under the applicable EV policy framework.
Strict monitoring under EV Policy 2020
The EDB has also been tasked with monitoring compliance with the government’s EV Policy 2020.
According to the FBR, the board will immediately notify tax authorities if any manufacturer is found to be violating the policy conditions or localisation requirements.
In such cases, the FBR may suspend further imports by the company at the concessional customs duty rate, preventing additional clearances under the incentive scheme.
Push for electric mobility
The continuation of customs duty concessions reflects the government’s broader strategy to promote investment in electric vehicle manufacturing and reduce dependence on conventional fuel-powered transport.
Officials believe the incentive framework will encourage automakers to introduce new electric vehicle models, expand local production capabilities and support the development of Pakistan’s emerging EV ecosystem.
The measures are also intended to facilitate technology transfer, attract investment into the automotive sector and contribute to environmental sustainability by promoting cleaner transport alternatives.
The revised customs duty rates will come into force from July 1, 2026, and remain applicable until June 30, 2027, unless revised through future fiscal measures.
