FBR Announces Adoption Levy on New Energy Vehicles

The Federal Board of Revenue (FBR) has officially declared the adoption levy rates for New Energy Vehicles (NEV), impacting both vehicles manufactured or assembled locally and those that are imported.

This updated tax framework is designed to encourage the shift towards electric and energy-efficient vehicles by applying levies on traditional internal combustion engine (ICE) vehicles.

Levy Details
  • Vehicles under 1300CC: Manufacturers of ICE vehicles with engine capacity under 1300CC will be subject to 1% ad valorem of the invoice price, which includes all duties and taxes. Similarly, importers of ICE vehicles in this category will also pay 1% ad valorem of the assessed value, inclusive of duties and taxes.
  • Vehicles between 1300CC and 1800CC: For locally assembled or manufactured ICE vehicles with engine capacities ranging from 1300CC to 1800CC, a 2% ad valorem levy will be applied to the invoice price, including duties and taxes. Importers of ICE vehicles within this engine capacity range will face a corresponding 2% ad valorem on the assessed value, inclusive of duties and taxes.
  • Vehicles exceeding 1800CC: Manufacturers of ICE vehicles with engine capacity exceeding 1800CC will be charged 3% ad valorem on the invoice price, inclusive of duties and taxes. A matching 3% ad valorem will be imposed on the assessed value, inclusive of duties and taxes, for imported ICE vehicles in this engine capacity bracket.
Commercial Vehicles
  • Imported buses and trucks equipped with combustion engines will incur a levy of 1%. A similar levy of 1% will be applicable to locally assembled buses and trucks.