The federal government has taken a significant step ahead of the arrival of the International Monetary Fund (IMF) mission by immediately allowing the commercial import of old vehicles. The move fulfills a key IMF condition with a September 30 deadline, signaling Islamabad’s commitment to structural reforms.
Officials confirmed that the new policy permits the import of five-year-old vehicles until June 30, 2026. Importers, however, will face a 40 percent additional tax compared to brand-new vehicles, alongside customs duty, additional customs duty, and regulatory duty.
From July 1, 2026, the age limit on imported vehicles will be removed altogether. To ease the transition, duties imposed on old vehicles will be gradually reduced by 10 percent each fiscal year until FY 2029-30. This phased approach is designed to support both consumers and importers while aligning with IMF requirements.
The change has been enacted through an amendment to the Import Policy Order 2022. Previously, commercial imports of older vehicles were restricted to specialized categories such as bulletproof cars, armored vans, ambulances, firefighting trucks, and security vehicles. The revised framework now extends approval to a much broader category of vehicles for commercial purposes.
Officials added that all imported vehicles must comply with environmental and safety standards to minimize risks related to emissions and road safety. This reflects Pakistan’s efforts to balance economic reforms with sustainable practices.
The decision is expected to have far-reaching effects on the auto industry. On one hand, it may introduce greater affordability for consumers who cannot access brand-new vehicles due to rising inflation and price hikes. On the other hand, industry insiders warn that it could challenge local manufacturers who may face stiffer competition from imported options.
For the government, this policy fulfills IMF’s requirement while potentially broadening revenue collection from taxes and duties. With economic reforms at the forefront of negotiations, the move is likely to play a pivotal role in Pakistan’s upcoming financial program.
