FBR updates advance income tax rates on goods transport, passenger and private motor vehicles under Section 234 for Tax Year 2027.
ISLAMABAD: The Federal Board of Revenue (FBR) has notified the advance income tax rates applicable to motor vehicles for Tax Year (TY) 2027 under the updated Income Tax Ordinance, 2001, following amendments introduced through the Finance Act, 2026.
The revised rates, effective from July 1, 2026, have been incorporated into the Income Tax Ordinance, 2001, updated to June 30, 2026. The provisions govern the collection of advance tax on goods transport vehicles, passenger transport vehicles and other motor vehicles under Section 234 of the Ordinance.
Advance tax on goods transport vehicles
Under Section 234, advance income tax on goods transport vehicles will continue to be collected based on the laden weight of the vehicle.
The applicable rate has been fixed at Rs2.50 per kilogram of laden weight.
In addition, goods transport vehicles with a laden weight of 8,120 kilograms or more will be liable to an annual advance tax of Rs1,200 after completing 10 years from the date of their first registration in Pakistan.
Tax rates for passenger transport vehicles
Passenger transport vehicles operating for hire will be subject to annual advance tax based on their registered seating capacity and whether they are air-conditioned.
| Seating capacity | Non-air-conditioned (Rs per seat/year) | Air-conditioned (Rs per seat/year) |
| 4 or more but less than 10 persons | 200 | 375 |
| 10 or more but less than 20 persons | 500 | 750 |
| 20 persons or more | 1,000 | 1,500 |
Advance tax on other motor vehicles
The annual advance tax on other motor vehicles will continue to be determined according to engine capacity.
| Engine capacity | Annual advance tax |
| Up to 1000cc | Rs800 |
| 1001cc to 1199cc | Rs1,500 |
| 1200cc to 1299cc | Rs1,750 |
| 1300cc to 1499cc | Rs2,500 |
| 1500cc to 1599cc | Rs3,750 |
| 1600cc to 1999cc | Rs4,500 |
| 2000cc and above | Rs10,000 |
Lump-sum motor vehicle tax
Where advance tax is collected on a lump-sum basis, the following rates will apply:
| Engine capacity | Lump-sum tax |
| Up to 1000cc | Rs10,000 |
| 1001cc to 1199cc | Rs18,000 |
| 1200cc to 1299cc | Rs20,000 |
| 1300cc to 1499cc | Rs30,000 |
| 1500cc to 1599cc | Rs45,000 |
| 1600cc to 1999cc | Rs60,000 |
| 2000cc and above | Rs120,000 |
Updated through Finance Act, 2026
The notified advance tax rates form part of the Income Tax Ordinance, 2001, updated to June 30, 2026, incorporating amendments introduced through the Finance Act, 2026.
The FBR said the updated provisions provide clarity to vehicle owners, transport operators, provincial excise and taxation authorities and withholding agents regarding the advance income tax applicable to goods transport vehicles, passenger transport vehicles and other motor vehicles during Tax Year 2027.