Karachi, November 15, 2024 – Pakistan has seen a significant surge in motor vehicle tax collection, with a 54% increase in the first quarter (July – September) of the fiscal year 2024-25. According to recent data released by the federal finance ministry, the total collection for this period reached Rs 13.82 billion, up from Rs 8.98 billion in the same quarter of the previous fiscal year.
Motor vehicle taxes are collected by provincial governments in Pakistan, and the latest figures show strong performance across the country. Punjab, the largest province in terms of population and economic activity, led the charge with a collection of Rs 8.92 billion during the July-September period of the current fiscal year. This marks a notable 50% increase compared to Rs 5.55 billion collected in the same period last year.
Sindh, home to the country’s largest city Karachi, also showed impressive growth, with a 69.4% increase in motor vehicle tax collection. The province collected Rs 4.32 billion during the first quarter of FY25, compared to Rs 2.55 billion in the corresponding period of the previous fiscal year.
Khyber Pakhtunkhwa, another key province, posted a solid 36% increase in its tax revenue, collecting Rs 862 million in motor vehicle taxes, up from Rs 635 million in the same quarter of FY24. Meanwhile, Balochistan recorded a 25.5% increase, with the province collecting Rs 320 million in motor vehicle taxes, compared to Rs 255 million during the same period last year.
The increase in motor vehicle tax collection is seen as a positive sign for Pakistan’s economy, reflecting both the rise in vehicle ownership and improved compliance with tax regulations. It is also indicative of the provincial governments’ growing efficiency in tax collection efforts.
Experts suggest that the surge in tax collection could help address budget deficits and strengthen the financial position of provincial governments. The trend may also encourage further reforms in the motor vehicle taxation system to ensure continued growth in revenue. With the first-quarter results already showing such strong performance, there is optimism that this momentum could continue throughout the remainder of the fiscal year.
As the government focuses on enhancing its tax collection mechanisms, the continued growth in motor vehicle tax revenue is likely to play a key role in achieving fiscal stability.
