Beginning on July 1, 2022, automobiles with engines of more than 1300cc and electric vehicles (EVs) with battery packs of more than 50 kWh will be subject to a 1 percent capital value tax (CVT).
It must be remembered that the government first recommended a 2 percent CVT on cars costing more than Rs. 5 million. The Proton X70, MG HS, Haval Jolion, H6, and other high-end automobiles with smaller turbocharged engines were targeted for taxation.
Later, the plan was scaled back to a 1% CVT on vehicles with engines larger than 1300cc. In order to help the general population, FBR reportedly cut the CVT from 2 percent to 1 percent. But the market expectation is that the new tax would increase.
The following vehicles are not covered by the CVT net:
- Suzuki Alto
- Wagon R
- Kia Picanto
- United Bravo
- Prince Pearl
- Proton Saga (1298cc)
- Honda City 1.2
Other than the vehicles on the aforementioned list, all vehicles with engines larger than 1300cc will be subject to a 1% CVT.