# IMF wants 18% sales tax on electric cars: a Rs 10 million EV could cost Rs 17 lakh more

Source: Searchable (https://searchable.pk/news/auto/imf-wants-18percent-sales-tax-on-electric-cars-a-rs-10-million-ev-could-cost-rs)
Type: News article
Author: Searchable Editorial
Published: 3 Oct 2026
Updated: 3 Oct 2026
Retrieved: 4 Oct 2026

> The 1% sales tax on locally assembled EVs is under pressure in the IMF review. What it could add to the Atto 3, Binguo, J6 and E5, and what to do if you are about to book.

The **IMF wants Pakistan to end the 1% sales tax on electric cars** and charge the standard 18% instead, ARY News reported on Saturday 3 October, citing talks on the next tranche of the IMF loan. If that happens, the price of an electric car in Pakistan could rise by roughly a sixth: on a Rs 10 million EV, sales tax would go from **Rs 100,000 to Rs 1.8 million**.

## What the IMF is asking for

Locally assembled electric vehicles with batteries of **up to 50 kWh** pay a reduced **1% sales tax**, a concession that Daily Pakistan reported has been extended to **30 June 2027**. Most other goods pay 18%. According to ARY News, the Fund told Pakistani officials during the review that the concession is discriminatory and that electric cars should be treated as luxury goods rather than goods that deserve a tax break. Daily Pakistan reported that the IMF prefers direct subsidies to tax concessions if the government wants to support EVs.

The dispute is not new. In June, PakWheels reported that the IMF had rejected the government's plan for a 1% sales tax on new energy vehicles for five years in the draft Auto Policy 2026-31, and wanted 18% across the board. ARY says officials now expect to revise the draft auto policy again. Nothing has been notified yet: **today's prices still carry the 1% rate.**

## What it could cost you

Daily Pakistan lists the BYD Atto 2 and Atto 3, the MG ZS EV and Binguo, the Jaecoo J6 and the Omoda E5 among the cars affected. As a rough guide, if the whole ex-factory price were taxed at 18% instead of 1% and nothing else changed, the official prices on our [car price list](/prices/cars) would move like this:

| Car | Price today | At 18% sales tax | Increase |
|---|---|---|---|
| MG Binguo EV | Rs 5,699,000 | about Rs 6.66 million | about Rs 9.6 lakh |
| BYD Atto 2 | Rs 7,290,000 | about Rs 8.52 million | about Rs 12.3 lakh |
| Jaecoo J6 | Rs 8,799,000 | about Rs 10.28 million | about Rs 14.8 lakh |
| BYD Atto 3 | Rs 8,990,000 | about Rs 10.50 million | about Rs 15.1 lakh |
| Omoda E5 | Rs 8,990,000 | about Rs 10.50 million | about Rs 15.1 lakh |

These are our estimates, not company prices: makers may absorb part of a tax change, and the final rule may treat models differently. Prices are each maker's published Pakistan price as listed on our price pages.

## Should you book now?

If you were already planning to buy an EV in the next few months, a booking made and paid under the current rate is the only price you can count on; ask the dealer in writing whether a tax change before delivery is passed on to you. Price the monthly payment on our [car loan calculator](/tools/cars/car-loan-calculator), and compare the running cost against petrol at today's [petrol price](/data/petrol-price) with the [fuel cost calculator](/tools/cars/fuel-cost-calculator). Registration costs are on the [car registration tax calculator](/tools/cars/car-registration-tax-calculator).

Hybrids are part of the same argument: the government had proposed 9% sales tax on hybrids in its auto policy draft, PakWheels reported in June. We will update this story when the government or the IMF publishes a decision.

## Frequently asked questions

**What is the sales tax on electric cars in Pakistan?**

1% for locally assembled EVs with batteries up to 50 kWh, a concession Daily Pakistan reported runs to 30 June 2027. The IMF wants the standard 18% applied instead. No change had been notified as of 3 October 2026.

**How much would an EV price rise at 18% sales tax?**

Roughly 17% if the whole price were taxed: about Rs 15 lakh on a Rs 8.99 million BYD Atto 3, and about Rs 17 lakh on a Rs 10 million car. Makers may absorb part of it.

## Sources

- IMF calls for end to sales tax concession on electric vehicles in Pakistan (3 Oct 2026) (ARY News): https://arynews.tv/imf-calls-for-end-to-sales-tax-concession-on-electric-vehicles-in-pakistan
- IMF pushes for 18% GST on EVs, putting Pakistan's 1% tax break at risk (3 Oct 2026) (Daily Pakistan): https://en.dailypakistan.com.pk/03-Oct-2026/imf-pushes-for-18-gst-on-evs-putting-pakistans-1-tax-break-at-risk
- IMF rejects Pakistan's 1% NEV sales tax proposal, auto policy delayed (20 Jun 2026) (PakWheels): https://www.pakwheels.com/blog/imf-rejects-nev-sales-tax-pakistan-auto-policy-delayed/

How to cite: "IMF wants 18% sales tax on electric cars: a Rs 10 million EV could cost Rs 17 lakh more", Searchable, 3 Oct 2026, https://searchable.pk/news/auto/imf-wants-18percent-sales-tax-on-electric-cars-a-rs-10-million-ev-could-cost-rs