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Islamabad: Govt Introduces Energy Vehicle Adoption Levy to Boost Electric Vehicle Use
Govt imposes “Energy Vehicle Adoption Levy” on fuel cars to promote EVs. Up to 3% charged based on engine size—aims to raise Rs10B for EV initiatives.
ND
by News Desk
2025-07-19
Islamabad: Govt Introduces Energy Vehicle Adoption Levy to Boost Electric Vehicle Use

The federal government has announced the imposition of an “Energy Vehicle Adoption Levy” on all conventional internal combustion engine (ICE) vehicles, both locally manufactured and imported. The new levy is projected to generate Rs10 billion in revenue, which will be exclusively used to promote electric vehicles (EVs) across the country.

Details of the Levy

According to the notification issued by the government:

·       Vehicles with engine capacity below 1300cc will be charged 1% levy

·       Vehicles between 1300cc and 1800cc will pay 2% levy

·       Vehicles above 1800cc will be charged 3% levy, including all applicable duties and taxes

·       Buses and trucks will also be subject to a 1% levy

The government emphasized that the levy applies to both local and imported vehicles, ensuring a uniform policy implementation across the automobile sector.

A Green Investment Strategy

Officials have clarified that this move is not merely a revenue-generating measure but part of a broader strategy to reduce carbon emissions, combat climate change, and incentivize the transition to electric mobility in Pakistan.

The Rs10 billion expected to be raised will be dedicated to:

·       Expanding EV charging infrastructure

·       Providing subsidies for EV buyers

·       Supporting local EV manufacturing

·       Running public awareness campaigns for clean transport

Industry and Public Response

While environmentalists have welcomed the decision as a progressive step toward sustainable development, auto industry stakeholders have raised concerns over the potential impact on vehicle prices, especially in the mid to high engine capacity segments.

The government maintains that this levy is in line with global trends where polluters are taxed to fund green alternatives.

 
Tagged:

ElectricVehicles

GreenPakistan

EVPolicy

AutoNewsPK

EnergyLevy
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