The federal government has reduced the additional regulatory duty on commercially imported used vehicles, a move aimed at gradually easing import costs and encouraging greater competition in Pakistan's automobile market.

According to a notification issued by the Federal Board of Revenue (FBR), the additional regulatory duty on imported used cars has been reduced from 40 percent to 30 percent, with the revised rate taking effect immediately.

The notification states that the 30 percent regulatory duty will apply to the commercial import of used vehicles and will be charged in addition to the existing customs duties and taxes already imposed on imported cars.

The government has also announced a long-term plan to reduce the additional regulatory duty by 10 percentage points every year, with the levy set to be completely abolished by the 2029-30 fiscal year.

Officials say the phased reduction is intended to provide predictability for importers while supporting broader trade and economic reforms. Industry experts believe the move could increase the availability of imported used vehicles and improve competition in the local auto market, although the final impact on retail prices will depend on exchange rates, shipping costs, and other import taxes.

Pakistan already permits the commercial import of used vehicles under the Import Policy Order 2022, following amendments introduced by the federal government.

However, the import of used cars remains subject to strict environmental and safety regulations. Importers must ensure that all vehicles comply with the required standards before they are allowed into the country.

Consumers and auto dealers will now closely watch whether the duty cut translates into lower vehicle prices in the coming months.