Car prices likely to decline up to Rs224,000 on duty cut

KARACHI: Consumers are expected to get up to Rs224,000 price advantage on automobile buying as the government have slashed federal excise duty and general sales tax on various vehicles with effect from Thursday, it was learnt.

Through amendments into the finance bill, the government reduced federal excise duty on vehicles with cylinder capacity of 1,000cc to zero percent from 2.5 percent. On cylinder capacity of 1,001cc to 2,000cc, the FED has been slashed to 2.5 percent from 5 percent and FED on cylinder capacity of 2,001 and above has decreased to 5 percent from 7.5 percent.

With the tax reduction, prices of Toyota Fortuner Sigma 4 are estimated to decrease by Rs224,395, according to estimates by Topline Research. At least Rs48,333 price advantage is for Suzuki Swift (manual).

General sales tax on for cylinder capacity of 660cc to 1,000cc has also been reduced to 12.5 percent from 17 percent, which together with FED cuts lead to price reduction between Rs88,722 for Suzuki Alto VXR and Rs107,111 for Suzuki Wagon R VXL, according to the estimates.

Local manufacturers are expected to soon release notification of new prices.

Topline Research estimates further showed that prices of Suzuki Swift automatic are estimated to decline by Rs52,619. Price of Honda Civic Turbo Oriel would fall Rs105,929. Honda Civic VTEC Oriel, in 1,500cc category, will be down Rs94,738.

Prices of Honda BR-V manual and automatic will be reduced by Rs75,214 and Rs79,024, respectively. Prices of Toyota Corolla Altix CVT in 1,600cc and 1,800cc categories will fall by Rs80,214 and Rs88,071, respectively. Two variants of Toyota Yaris ATIV CVT and MT will see prices decrease Rs65,929 and Rs62,357, respectively. Price of Toyota Corolla Grande will be reduced by Rs94,738. Price of Toyota Fortuner G is estimate to fall Rs186,023.

Prices of Toyota Hilux REVO G and V automatic will decrease Rs160,442 and Rs174,395, respectively. Prices of KIA Picanto MT and AT will be down Rs117,574 and Rs126,861, respectively. Price of KIA Sportage Alpha, FWD and AWD will decline Rs104,738, Rs116,643, and Rs128,548, respectively. Prices of KIA Sorento FWD, AWD and FWD 3,500cc will fall by Rs162,767, RsRs186,023 and Rs195,326, respectively.

Through amendments into the finance bill, the proposal to abolish duty on local manufacturing of vehicles of cylinder capacity up to 850cc has been withdrawn.