The federal cabinet has approved the new Electric Vehicle (EV) policy for four wheelers. Earlier this week the EV policy was approved by the Economic Coordination Committee (ECC) which was today presented against the federal cabinet for approval.
The new policy stipulates rules for electric four-wheelers along the lines of import and export, taxation, registration, and customs duty. Federal Minister for Industries and Production Mr Hammad Azhar has made the announcement in his tweet while highlighting the key benefit the EV policy offers:
- No Additional Customs Duty (ACD) on the import of EVs
- No Advanced Sales Tax (AST) on the import of EVs
- Only 1% tax levied on the import of EV parts for manufacturers
- Only 1% sales tax for locally made EVs up to 50kwh and light commercial vehicles up to 150 kwh
- Only 1% duty on import of charging equipment
- No Federal Excise Duty (FED) on EVs
- Duty free import of plant and machinery for manufacturing of EVs
- No registration and annual renewal fee for EVs in Islamabad
According to Fawad Chaudhry, the shift from conventional combustion engine vehicles to EVs will not only benefit the environment but will also lessen the burden on country’s fuel import bill while help bringing a descending trend in prices.
The government is also working on to set up EV charging infrastructure across the country to help boost the use of electric vehicles. Furthermore government is also planning electrification of the public transport sector which will see nearly 40% of public buses to be converted into EVs with the next 10 years.
As far as the private transport is concerned, South Korean & Chinese automakers will be gearing up to introduce 4-wheel electric vehicle in Pakistan, however this is the area where Japanese automakers are expected to lag behind due to the absence of electric vehicles in their global lineup. From the looks of it, the competition in the auto sector is expected to become very interesting in forthcoming period.