Pakistan Permits Commercial Import of Used Sedan Cars with Age and Duty Regulations

In a significant policy change aimed at fulfilling conditions set by the International Monetary Fund (IMF), the federal government of Pakistan has approved the commercial import of sedan cars and other vehicles. This decision follows the recent Economic Coordination Committee (ECC) meeting, where amendments were made to the Import Policy Order, 2022 to accommodate used vehicle imports.

The government has introduced new categories under the Pakistan Customs Tariff specifically for these imports. Custom Tariff Codes 8702 and 8703 now apply to the commercial import of sedan cars, while Code 8704 covers light commercial vehicles and vans.

Regarding the age of imported vehicles, the government initially restricts imports to vehicles not older than five years until 30th June 2026. After this date, the age limit will be lifted. However, all imports must strictly comply with the prescribed environmental and safety standards to ensure regulatory compliance.

Additionally, a 40 percent Regulatory Duty (RD) will be levied on the commercial import of used vehicles under five years old, supplementing existing customs duties. This RD will be effective until 30th June 2026, after which it will be reduced by 10 percentage points annually, ultimately being phased out by the fiscal year 2029-30, as recommended by the Tariff Policy Board.

This policy shift reflects Pakistan’s efforts to balance economic needs while adhering to international agreements and environmental standards.