Federal government has implemented a 1 percent Capital Value Tax (CVT), on vehicles with engines greater than 1300cc, and electric vehicles (EVs with batteries larger than 50 kWh) effective July 1, 2022.
The government initially recommended 2 percent CVT for vehicles priced over Rs. 5 million. It was created to tax high-end turbocharged vehicles such as Proton X70 and MG HS.
Later, the proposal was reduced to 1% CVT for cars with engines displacements greater than 1300cc. According to multiple reports, FBR reduced the CVT to 1 percent from 2 percent in order to benefit the public. The market believes that the new tax will be worse for economy-car owners. Also Read
These are the cars that don’t fall under the CVT net:
- Suzuki Alto
- Wagon R
- Honda City 1.2
- Kia Picanto
- United Bravo
- Prince Pearl
- Proton Saga (1298cc)