The Federal Board of Revenue (FBR) announced the increased advance tax rates for vehicles sold before to first registration.
The tax rates have been raised by amending Section 231(B)(2A) of the Income Tax Ordinance, 2001.
According to the FBR, the advance tax on vehicle registration under Section 231(B)(2A) of the Ordinance has been raised for those who register motor vehicles that have been sold before their first registration.
The real reason behind this initiative is to discourage “On Money” on vehicles paid by investors, which creates the unavailability of vehicles for genuine buyers.
The following are the new rates under increasing the tax:
- The advance tax on a motor vehicle with an engine capacity of up to 1000CC has been raised to Rs100,000 from Rs50,000.
- For motor vehicles with engine capacities ranging from 1001cc to 2000cc, the advance tax has been raised from Rs100,000 to Rs200,000.
- The advance tax on motor vehicles with engine capacities of 2001cc and above has been raised from Rs200,000 to Rs400,000.