Reversing the Ban: A Detailed ‍Look

The Economic Coordination Committee (ECC) of the Cabinet made the decision on Wednesday, May ‍8, 2024, to amend the Import Policy Order, 2022, paving the way for the commercial import of used vehicles (Dawn, May 9, 2024). ⁣The move follows a period where the import of used ‍cars was restricted, impacting availability and prices in the domestic market.

Federal⁣ Finance and Revenue Minister Muhammad Aurangzeb chaired the ECC meeting virtually from New York, according to a ‍statement released by the Finance Division (Finance Division, May 8, 2024). The ‍committee’s approval came after a detailed discussion of the⁣ proposals.

Phased Implementation and Duty Structure

The import policy will be implemented⁢ in phases. Initially, only vehicles not older than five years will ‍be permitted for import until June 30, 2026. ⁢ After this date, the age limit⁤ for imported vehicles⁢ will be ⁤removed entirely (Dawn, may 9, 2024). This staged approach is likely intended to allow the market to adjust and to ‍assess the impact of the policy change.

To mitigate potential negative impacts on the local automotive industry and to generate revenue, the ECC approved a 40% regulatory duty on the import of used vehicles less than five years old.this duty will be in addition to existing customs duties (Finance Division, ⁢May 8, 2024). The duty structure is also⁢ phased:

• until June 30, 2026: ‍ 40% regulatory duty + existing customs duties.
• 2026-2027: 30% regulatory duty.
• 2027-2028: ‍20% regulatory duty.
• 2028-2029: 10% regulatory duty.
• 2029-2030: 0% ⁢regulatory duty.

This gradual reduction,aligned with⁣ recommendations from the Tariff Policy Board,aims to balance import liberalization with the need to protect ‍domestic manufacturers.

Environmental and ⁤Safety Standards

The ECC emphasized that all⁢ commercial imports of used vehicles will be subject to strict compliance with prescribed environmental and safety standards