Pakistan is considering major changes to its used car import policy, with the government exploring the merger of the personal baggage and gift schemes into the upcoming five-year commercial import framework. The new policy is expected to take effect on October 1, 2025.
Commerce Secretary Jawad Paul, while briefing the National Assembly Standing Committee on Commerce, said the proposal aims to streamline the import process for used vehicles. Under the new plan, five-year-old imported cars will face a 40% duty, which will be reduced by 10% each year.
Paul acknowledged that the personal baggage and gift schemes have long benefited overseas Pakistanis. However, the proposed integration with the used car import policy remains under discussion, and no final decision has been reached. The transfer of residence scheme will remain outside the merger.
Committee members raised concerns about the impact of these measures on the country’s foreign exchange reserves and the automobile industry. They suggested lowering the 40% duty on five-year-old cars to make the new import policy more practical.
Meanwhile, a group of used car importers urged that the Ministry of Commerce, rather than the Engineering Development Board (EDB) under the Ministry of Industries, should manage the commercial import process. They argued that the Commerce Ministry is better suited since it directly oversees imports and exports.
However, the Commerce Secretary distanced himself from this recommendation, emphasizing that matters relating to the automobile sector fall under the jurisdiction of the Ministry of Industries.
Chairman of the Standing Committee, Jawed Hanif Khan, opposed the proposal and referred the issue, along with recommendations, to the National Assembly Standing Committee on Industries and Production for further consideration.